Parnell Company acquired construction equipment on January 1, 2017, at a cost of $78,400. The equipment was

Question:

Parnell Company acquired construction equipment on January 1, 2017, at a cost of $78,400. The equipment was expected to have a useful life of six years and a residual value of $10,000 and is being depreciated on a straight-line basis. On January 1, 2018, the equipment was appraised and determined to have a fair value of $74,500, a of $10,000, and a remaining useful life of five years. In measuring property, plant, and equipment subsequent to acquisition under IFRS, Parnell would opt to use the revaluation model in IAS 16.
a. Determine the appropriate accounting for this equipment for the years ending December 31, 2017, and December 31, 2018, under (1) U.S. and (2) IFRS.
b. Prepare the entry(ies) that Parnell would make on the December 31, 2017, and December 31, 2018, conversion worksheets to convert U.S. balances to IFRS.
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