Question
In: Accounting
On 1 July 2019, CRX Construction Ltd paid $150,000 cash to acquire an item of plant...
On 1 July 2019, CRX Construction Ltd paid $150,000 cash to acquire an item of plant equipment. On this date it was estimated that the item of plant equipment had a useful life of ten years and a residual value of $20,000. CRX Construction Ltd uses the revaluation model to measure items of property, plant and equipment and the straight-line method of depreciation. CRX Construction Ltd has a 30 June reporting date.
An independent valuer provided the following fair values for the item of plant equipment:
Reporting date Fair value
30 June 2020 $110,000
30 June 2021 116,000
30 June 2022 118,000
On 30 September 2022, the item of plant equipment was sold for $120,500 cash.
Required
Prepare the journal entries to account for the events and transactions in relation to the item of plant equipment between 1 July 2019 and 30 September 2022.
Solutions
ekkarill92 answered 1 year agoRelated Solutions
On 1 July 2019, CRX Construction Ltd paid $150,000 cash to acquire an item of plant...
On 1 July 2019, CRX Construction Ltd paid $150,000 cash to
acquire an item of plant equipment. On this date it was estimated
that the item of plant equipment had a useful life of ten years and
a residual value of $20,000. CRX Construction Ltd uses the
revaluation model to measure items of property, plant and equipment
and the straight-line method of depreciation. CRX Construction Ltd
has a 30 June reporting date.
An independent valuer provided the following fair values...
On 1 July 2017, Cambridge Ltd paid $250,000 cash to acquire a machine. On this date...
On 1 July 2017, Cambridge Ltd paid $250,000 cash to acquire a
machine. On this date it was estimated that the machine had a
useful life of ten years and a residual value of $30,000. In
accordance with AASB 116 Property, Plant and Equipment, Cambridge
Ltd uses the revaluation model as its accounting policy to measure
items of property, plant and equipment and the straight-line method
of depreciation. Cambridge Ltd has a 30 June reporting date.
An independent valuer provided...
On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for $450000...
On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for
$450000 when its’ carrying value in Liala Ltd book was $600000
(costs $900000, accumulated depreciation $300000). 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 30 percent. Required: Pass the necessary entries
on 30 June 2017 and 30 June 2018 to eliminate the...
On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for $450000...
On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for
$450000 when its’ carrying value in Liala Ltd book was $600000
(costs $900000, accumulated depreciation $300000). 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 30 percent.
Required:
Pass the necessary entries on 30 June 2017 and 30 June 2018 to
eliminate the...
On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for $450000...
On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for
$450000 when its’ carrying value in Liala Ltd book was $600000
(costs $900000, accumulated depreciation $300000). 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 30 percent.
Required: Pass the necessary entries on 30 June 2017 and 30 June
2018 to eliminate the...
On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for $450000...
On 1 July 2016 Liala Ltd sold an item of plant to Jordan Ltd for
$450000 when its’ carrying value in Liala Ltd book was $600000
(costs $900000, accumulated depreciation $300000). 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 30 percent.
Required:
Pass the necessary entries on 30 June 2017 and 30 June 2018 to
eliminate the...
(16 marks) Wastewater Ltd acquired an item of plant on 1 July 2016 for $3 660...
Wastewater Ltd acquired an item of plant on 1 July
2016 for $3 660 000. When the item of plant was acquired, it was
initially assessed as having a life of 10000 hours. During the
reporting period ending 30 June 2017 the plant was operated for
3000 hours. At 1 July 2017 the plant had a remaining useful life of
7000 hours. On 1 July 2017 the plant underwent a major upgrade
costing $234 600. Management believes that this upgrade...
Question 2: (16 marks) Wastewater Ltd acquired an item of plant on 1 July 2016 for...
Question 2: Wastewater Ltd acquired an item of plant
on 1 July 2016 for $3 660 000. When the item of plant was acquired,
it was initially assessed as having a life of 10000 hours. During
the reporting period ending 30 June 2017 the plant was operated for
3000 hours.
At 1 July 2017 the plant had a remaining useful life of 7000
hours. On 1 July 2017 the plant underwent a major upgrade costing
$234 600. Management believes that...
In late July 2017, KARA Ltd., a private company, paid $1.90 million to acquire all of...
In late July 2017, KARA Ltd., a private company, paid $1.90
million to acquire all of the net assets of DYC Corp., which then
became a division of KARA. Flint reported the following statement
of financial position at the time of acquisition:
Current assets
$415,000
Current liabilities
$300,000
Non-current assets
1,335,000
Long-term liabilities
265,000
Shareholders’ equity
1,185,000
$1,750,000
$1,750,000
It was determined at the date of the purchase that the fair value
of the identifiable net assets of DYC was...
On 1 July 2020, Sherlock Ltd leased a processing plant to Holmes Ltd. The plant was...
On 1 July 2020, Sherlock Ltd leased a processing plant to Holmes
Ltd. The plant was purchased by Sherlock Ltd on 1 July 2020 for its
fair value of $467 112. The lease agreement contained the following
provisions:
Holmes Ltd intends to return the processing plant to Sherlock
Ltd at the end of the lease term. The lease has been classified as
a finance lease by Sherlock Ltd.
Required
Prepare:
(a) the lease payments schedule for Holmes Ltd (show all...
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