Swan Ltd purchased vintage equipment on 1 July 2021 for $119 400 cash. Transport and installation costs
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Question:
Swan Ltd purchased vintage equipment on 1 July 2021 for $119 400 cash. Transport and installation costs of $12 600 were paid on 5 July 2021. Useful life and residual value were estimated to be 10 years and $5400 respectively.
Swan Ltd depreciates equipment using the straight-line method to the nearest month, and reports annually on 30 June. All calculations are rounded to the nearest dollar. The tax rate is 30%
- On 30 June 2023, Swan Ltd decides to adopt the revaluation model to account for equipment. The fair value of equipment on this date is $90 000.
- On 30 June 2024, the fair value of equipment is $100 000.
- On 30 September 2024, the equipment is sold for $95 000 cash.
Required:
- Prepare general journal entries to record depreciation and a revaluation of the equipment on 30 June 2023.
- Prepare general journal entries to record depreciation and a revaluation of the equipment on 30 June 2024.
- Prepare general journal entries to record depreciation and the sale of the equipment on 30 September 2024.
Related Book For
Accounting Business Reporting for Decision Making
ISBN: 9780730302414
4th edition
Authors: Jacqueline Birt, Keryn Chalmers, Albie Brooks, Suzanne Byrne, Judy Oliver
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