On 1 July 2022, your company acquired a machine for $103,000 on credit and decided to depreciate it for 25 years with no residual amount. The credit was taken from a local bank that charges 4.2% per annum with payments every year on 30 June. Assume that the fair values of this asset were: Date Fair Value 1/7/2023 $105,000 30/11/2023 $98,000 30/6/2024 $80,000 a. Using the cost model, prepare the relevant journal entries from the date of acquisition to 30 June 2023 b.Using the revaluation model, prepare the relevant journal entries from the date of acquisition to 30 June 2023.
On 1 July 2022, your company acquired a machine for $103,000 on credit and decided to depreciate it for 25 years with no residual amount. The credit was taken from a local bank that charges 4.2% per annum with payments every year on 30 June. Assume that the fair values of this asset were: Date Fair Value 1/7/2023 $105,000 30/11/2023 $98,000 30/6/2024 $80,000 a. Using the cost model, prepare the relevant journal entries from the date of acquisition to 30 June 2023 b.Using the revaluation model, prepare the relevant journal entries from the date of acquisition to 30 June 2023.
Chapter11: Long-term Assets
Section: Chapter Questions
Problem 8PA: Referring to PA7 where Kenzie Company purchased a 3-D printer for $450,000, consider how the...
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On 1 July 2022, your company acquired a machine for $103,000 on credit and decided to depreciate it for 25 years with no residual amount. The credit was taken from a local bank that charges 4.2% per annum with payments every year on 30 June.
Assume that the fair values of this asset were:
Date Fair Value 1/7/2023 $105,000 30/11/2023 $98,000 30/6/2024 $80,000
a. Using the cost model, prepare the relevant
b.Using the revaluation model, prepare the relevant journal entries from the date of acquisition to 30 June 2023.
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