On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for $350000 when its’ carrying value in Liala Ltd book was $500000 (costs $850000, accumulated depreciation $350000). This plant has a remaining useful life of five (5) years form the date of sale. The group measures its property plants and equipment using a costs model. Tax rate is 40 percent. Required: Pass the necessary entries on 30 June 2017 and 30 June 2018 to eliminate the intra-group transfer of equipment.
On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for $350000 when its’ carrying value in Liala Ltd book was $500000 (costs $850000, accumulated depreciation $350000). This plant has a remaining useful life of five (5) years form the date of sale. The group measures its property plants and equipment using a costs model. Tax rate is 40 percent. Required: Pass the necessary entries on 30 June 2017 and 30 June 2018 to eliminate the intra-group transfer of equipment.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for $350000 when its’ carrying value in Liala Ltd book was $500000 (costs $850000,
years form the date of sale. The group measures its property plants and equipment using a costs model. Tax rate is 40 percent.
Required:
Pass the necessary entries on 30 June 2017 and 30 June 2018 to eliminate the intra-group transfer of equipment.
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