FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Looking for answers, Please include all the calculations for my reference. Thanks!

Clarke Inc. owns an investment property with the following data:
Cost - January 1, 2015
Fair value - December 31, 2015
$720,000
$652,000
$680,000
$648,000
Fair value - December 31, 2018
Fair value - December 31, 2020
REQUIRED
Assume that Clarke decides to apply the fair value model. Prepare the journal entry to record the initial investment.
Also prepare the journal entries, if any, required for the dates indicated above.
Date
Description
Dr
Cr
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Transcribed Image Text:Clarke Inc. owns an investment property with the following data: Cost - January 1, 2015 Fair value - December 31, 2015 $720,000 $652,000 $680,000 $648,000 Fair value - December 31, 2018 Fair value - December 31, 2020 REQUIRED Assume that Clarke decides to apply the fair value model. Prepare the journal entry to record the initial investment. Also prepare the journal entries, if any, required for the dates indicated above. Date Description Dr Cr
Clarke Inc. also has fixed assets, with a selected account listed below at December 31, 2019:
Building
Less: Accumulated Depreciation
400,000
50,000
350,000
Clarke uses straight-line depreciation for its building (remaining useful life is 10 years, no residual value).
Clarke decides to adopt the revaluation model for its building effective December 31, 2019. On this date,
an independent appraiser assessed the fair value of the building to be $365,000.
REQUIRED
a) Prepare the journal entry required, if any, to revalue the building as at December 3
b) Prepare the journal entry to record depreciation expense for the year ended December 31, 2020 for the building.
a)
Date
Description
Dr
Cr
b)
Date
Description
Dr
Cr
expand button
Transcribed Image Text:Clarke Inc. also has fixed assets, with a selected account listed below at December 31, 2019: Building Less: Accumulated Depreciation 400,000 50,000 350,000 Clarke uses straight-line depreciation for its building (remaining useful life is 10 years, no residual value). Clarke decides to adopt the revaluation model for its building effective December 31, 2019. On this date, an independent appraiser assessed the fair value of the building to be $365,000. REQUIRED a) Prepare the journal entry required, if any, to revalue the building as at December 3 b) Prepare the journal entry to record depreciation expense for the year ended December 31, 2020 for the building. a) Date Description Dr Cr b) Date Description Dr Cr
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