Bravo Company's furnace, which has a current book value of $40,000 (original cost less than accumulated depreciation), has been destroyed. If the insurance company pays Bravo $45,000, which of the following transactions is Bravo supposed to record?

Prepare journal entries to record these transactions. (a) Echo Company retires its delivery equipment, which cost $41000. Accumulated depreciation is also $41000 on this delivery equipment. No salvage value is received. (b) Assume the same information as in part (a), expcept that accumulated depreciation for the equipment is $37200 instead of $41000.

Star Co had an on-going litigation claim which had been brought against the company for damage to a public road allegedly caused by one of its lorries. At 1 October 20X2, Star Co had disclosed a contingent liability of $120,000. Due to new developments in the court case, the latest correspondance with the solicitors at 30 September 20X3 suggests it is now probable that Star Co will lose and have to pay damages of $150,000. What is the impact of the above provision on the statements of profit or loss for the year ended 30 September 20X3?

Windsor Company owns equipment that cost $972,000 and has accumulated depreciation of $410,400. The expected future net cash flows from the use of the asset are expected to be $540,000. The fair value of the equipment is $432,000.Prepare the journal entry, if any, to record the impairment loss. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.) Account Titles and Explanation Debit Credit enter an account title   enter a debit amount   enter a credit amount   enter an account title   enter a debit amount   enter a credit amount

Novak Corp., a small company that follows ASPE, owns machinery that cost $925,000 and has accumulated depreciation of $385,000. The undiscounted future net cash flows from the use of the asset are expected to be $513,000. The equipment's fair value is $440,000. Using the cost recovery impairment model, prepare the journal entry, if any, to record the impairment loss. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List debit entry before credit entry.) Account Titles and Explanation Debit Credit

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