Chapter F, Problem 6E

To determine

Concept Introduction:

International financial reporting framework (IFRS):

International financial reporting framework is the accounting framework/ accounting standards followed internationally to prepare the financial statements. IFRS are issued by the International Accounting Standards Board (IASB). IFRS fulfill the objective of common accounting standards worldwide.

United States generally accepted Accounting Policies (US GAAP):

United States generally Accepted Accounting Policies is the accounting framework/ accounting standards followed in the United States to prepare the financial statements. US GAAPS are issued by Financial Accounting Standards Board (FASB).

Requirement-1:

To Prepare:

The journal entry to record the depreciation expense on Property, plant, and equipment

Answer to Problem 6E

The journal entry to record the depreciation expense on Property, plant, and equipment is as follows:

Journal entries
Account Titles	Debit	Credit
Depreciation Expense	7,509
Accumulated Depreciation		7,509

Explanation of Solution

The journal entry to record the depreciation expense on Property, plant, and equipment is explained as follows:

Journal entries
Account Titles	Debit	Credit
Depreciation Expense	7,509
Accumulated Depreciation		7,509
(Being depreciation expense recorded)

To determine

Concept Introduction:

International financial reporting framework (IFRS):

International financial reporting framework is the accounting framework/ accounting standards followed internationally to prepare the financial statements. IFRS are issued by the International Accounting Standards Board (IASB). IFRS fulfill the objective of common accounting standards worldwide.

United States generally accepted Accounting Policies (US GAAP):

United States generally Accepted Accounting Policies is the accounting framework/ accounting standards followed in the United States to prepare the financial statements. US GAAPS are issued by Financial Accounting Standards Board (FASB).

Requirement-2:

To Prepare:

The journal entry to record the addition to Property, plant, and equipment

Answer to Problem 6E

The journal entry to record the addition to Property, plant, and equipment is as follows:

Journal entries
Account Titles	Debit	Credit
Property, plant, and equipment	11,560
Cash		11,560
(Being addition to Property, plant, and equipment recorded)

Explanation of Solution

The journal entry to record the addition to Property, plant, and equipment is explained as follows:

Journal entries
Account Titles	Debit	Credit
Property, plant, and equipment	11,560
Cash		11,560
(Being addition to Property, plant, and equipment recorded)

To determine

Concept Introduction:

International financial reporting framework (IFRS):

International financial reporting framework is the accounting framework/ accounting standards followed internationally to prepare the financial statements. IFRS are issued by the International Accounting Standards Board (IASB). IFRS fulfill the objective of common accounting standards worldwide.

United States generally accepted Accounting Policies (US GAAP):

United States generally Accepted Accounting Policies is the accounting framework/ accounting standards followed in the United States to prepare the financial statements. US GAAPS are issued by Financial Accounting Standards Board (FASB).

Requirement-3:

To Prepare:

The journal entry to record the disposal of Property, plant, and equipment

Answer to Problem 6E

The journal entry to record the disposal of Property, plant, and equipment is as follows:

Journal entries
Account Titles	Debit	Credit
Cash	720
Accumulated Depreciation	1,195
Loss on Disposal	515
Property, plant, and equipment		2,430

Explanation of Solution

The journal entry to record the disposal of Property, plant, and equipment is explained as follows:

Journal entries
Account Titles	Debit	Credit
Cash	720
Accumulated Depreciation	1,195
Loss on Disposal (2430-1195-720)	515
Property, plant, and equipment		2,430
(Being disposal of Property, plant, and equipment recorded)

To determine

Concept Introduction:

International financial reporting framework (IFRS):

International financial reporting framework is the accounting framework/ accounting standards followed internationally to prepare the financial statements. IFRS are issued by the International Accounting Standards Board (IASB). IFRS fulfill the objective of common accounting standards worldwide.

United States generally accepted Accounting Policies (US GAAP):

United States generally Accepted Accounting Policies is the accounting framework/ accounting standards followed in the United States to prepare the financial statements. US GAAPS are issued by Financial Accounting Standards Board (FASB).

Requirement-4:

To Indicate:

The effect of the Impairment on the value of Property, plant, and equipment

Answer to Problem 6E

The Impairment shall reduce the net value of Property, plant, and equipment by 143.

Explanation of Solution

The journal entry to record the impairment of Property, plant, and equipment is explained as follows:

Journal entries
Account Titles	Debit	Credit
Loss on Impairment	143
Property, plant, and equipment		143
(Being Impairment loss recorded)

Hence, the Impairment shall reduce the net value of Property, plant, and equipment by 143.