Machinery purchased for $47,800 by Flounder Corp. on January 1, 2018, was originally estimated to have...

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Machinery purchased for $47,800 by Flounder Corp. on January 1, 2018, was originally estimated to have an 8-year useful life with a residual value of $3,000. Depreciation has been entered for five years on this basis. In 2023, it is determined that the total estimated useful life (including 2023) should have been 10 years, with a residual value of $4,000 at the end of that time. Assume straight-line depreciation and that Flounder uses IFRS for financial statement purposes. (a) Your answer is correct. Prepare the entry that is required to correct the prior years' depreciation, if any. (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.) (b) Account Titles and Explanation No Entry No Entry Your answer is correct. Debit Credit Prepare the entry to record depreciation for 2023. (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.) (c) Account Titles and Explanation Depreciation Expense Accumulated Depreciation - Machinery Your answer is partially correct. Debit 3,160 Credit 3,160 Repeat part (b) assuming Flounder uses ASPE and the machinery is originally estimated to have a physical life of 8.5 years and a salvage value of $0. In 2023, it is determined that the total estimated physical life (including 2023) should have been 11 years, with a salvage value of $100 at the end of that time. (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. Round answers to O decimal places, e.g. 5,275.) Account Titles and Explanation Depreciation Expense Debit 3,137 Credit (d) Accumulated Depreciation - Machinery 3,137 Repeat part (b) assuming Flounder uses the double-declining-balance method of depreciation. (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. Round answers to O decimal places, e.g. 5,275.) Account Titles and Explanation Debit Credit Machinery purchased for $47,800 by Flounder Corp. on January 1, 2018, was originally estimated to have an 8-year useful life with a residual value of $3,000. Depreciation has been entered for five years on this basis. In 2023, it is determined that the total estimated useful life (including 2023) should have been 10 years, with a residual value of $4,000 at the end of that time. Assume straight-line depreciation and that Flounder uses IFRS for financial statement purposes. (a) Your answer is correct. Prepare the entry that is required to correct the prior years' depreciation, if any. (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.) (b) Account Titles and Explanation No Entry No Entry Your answer is correct. Debit Credit Prepare the entry to record depreciation for 2023. (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.) (c) Account Titles and Explanation Depreciation Expense Accumulated Depreciation - Machinery Your answer is partially correct. Debit 3,160 Credit 3,160 Repeat part (b) assuming Flounder uses ASPE and the machinery is originally estimated to have a physical life of 8.5 years and a salvage value of $0. In 2023, it is determined that the total estimated physical life (including 2023) should have been 11 years, with a salvage value of $100 at the end of that time. (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. Round answers to O decimal places, e.g. 5,275.) Account Titles and Explanation Depreciation Expense Debit 3,137 Credit (d) Accumulated Depreciation - Machinery 3,137 Repeat part (b) assuming Flounder uses the double-declining-balance method of depreciation. (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. Round answers to O decimal places, e.g. 5,275.) Account Titles and Explanation Debit Credit

Answer rating: 100% (QA)

Flounder Corp Machinery Depreciation Correction a Correction of Prior Years Depreciation IFRS No entry is required under IFRSHeres why IFRS allows for ... View the full answer