Zhang Zinc Mines Ltd. decided on 1 April 20X8 to dispose of one of its mining properties
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Required:
1. Prepare journal entries to recognize the mineral rights and equipment as a disposal group, including any reclassification entries, if necessary.
2. Assume that at 30 June (the end of the second quarter), the value of zinc has increased and the mineral rights are worth $ 1,150,000. Prepare any necessary journal entries to reflect the increase in value.
3. On 21 August ( in the third quarter), Zhang signs a contract to convey all rights to the mine and the equipment to Rio Tonto Inc., an Australian- based mining company. The contract price is $ 1,350,000. Prepare the journal entry (or entries) to record the sale.
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Related Book For
Intermediate Accounting
ISBN: 978-0071339476
Volume 1, 6th Edition
Authors: Beechy Thomas, Conrod Joan, Farrell Elizabeth, McLeod Dick I
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