Question1: ABC Ltd purchased a machine at a cost of $300,000 on 1 July 2020. It had a useful life of 10 years and after that residual value was estimated to be $60,000. The benefits from machine are expected to be spread evenly over its life. On 30 June 2022, fair value of machine was $230,000 and the salvage value and useful remaining life were the same as estimated at the time of its purchase. On 30 June 2022, the machine was sold for $130,000. What journal entries will be recorded right from beginning until the sale of machine as per AASB 116 in the following cases: a) If the revaluation was recorded. b) If the revaluation was not recorded. c) What will be the value of Impairment on 30 June 2022 if it was decided not to sell the machine.
Question1: ABC Ltd purchased a machine at a cost of $300,000 on 1 July 2020. It had a useful life of 10 years and after that residual value was estimated to be $60,000. The benefits from machine are expected to be spread evenly over its life. On 30 June 2022, fair value of machine was $230,000 and the salvage value and useful remaining life were the same as estimated at the time of its purchase. On 30 June 2022, the machine was sold for $130,000.
What
a) If the revaluation was recorded.
b) If the revaluation was not recorded.
c) What will be the value of Impairment on 30 June 2022 if it was decided not to sell the machine.
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