Su Ltd. acquired an excavator on January 1, 2020, for 10,000 (all amounts in thousands). This excavator
Question:
Su Ltd. acquired an excavator on January 1, 2020, for ¥10,000 (all amounts in thousands). This excavator represents the company’s only piece of equipment, and Su chooses revaluation accounting. This excavator is being depreciated on a straight-line basis over its 10-year useful life. There is no residual value at the end of the 10-year period. The appraised value of the excavator approximates the carrying value at December 31, 2020 and 2022. On December 31, 2021, the fair value is determined to be ¥8,800; on December 31, 2023, the fair value is determined to be ¥5,000.
Instructions
a. Show all journal entries for each year-end from 2020 through 2023.
b. Su also owns some property and buildings for which revaluation accounting is not used. Briefly discuss why Su might not use revaluation accounting for these assets.
Step by Step Answer:
Intermediate Accounting IFRS
ISBN: 9781119607519
4th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield