Dower Corporation prepares its financial statements according to IFRS. On March 31, 2018, the company purchased equipment
Question:
Dower Corporation prepares its financial statements according to IFRS. On March 31, 2018, the company purchased equipment for $240,000. The equipment is expected to have a six-year useful life with no residual value. Dower uses the straight-line depreciation method for all equipment. On December 31, 2018, the end of the company's fiscal year, Dower chooses to revalue the equipment to its fair value of $220,000.
Required:
1. Calculate depreciation for 2018.
2. Prepare the journal entry to record the revaluation of the equipment. Round calculations to the nearest thousand.
3. Calculate depreciation for 2019.
4. Repeat requirement 2 assuming that the fair value of the equipment at the end of 2018 is $195,000.
Financial StatementsFinancial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...
Step by Step Answer:
Intermediate Accounting
ISBN: 9781259722660
9th Edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas