The deferred exploration and evaluation expenditure had been recorded in the books of Beers Ltd at...
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The deferred exploration and evaluation expenditure had been recorded in the books of Beers Ltd at $600,000. The property plant and equipment contributed to the joint operation by Beers Ltd was originally purchased for $1,500,000 with accumulated depreciation of $700,000 at 1 July 2018. This asset is considered impaired. Beers Ltd decides not to revalue its remaining interest in the non-current assets contributed to the joint operation. The PPE contributed by Tiffany's was new and recorded at $3,000,000. Beers Ltd sold 80% of its gold for $200,000. The following was extracted from the accounting records kept by the joint operation manager for the year ending 30 June 2019. Joint operation balance sheet extract at 30 June 2019 Cash and cash equivalents 400,000 Supplies 100,000 Undistributed gold 666,667 Deferred exploration and evaluation expenditure 1,000,000 Property Plant and Equipment Accounts payable 7,500,000 (500,000) Net assets 9,166,667 Joint operation cash receipts and payments for the year ended 30 June 2019 Cash contributions from operators 5,500,000 Less: Cash payments Plant and Equipment (4,000,000) Wages (500,000) Materials and supplies (350,000) Wages (500,000) Materials and supplies (350,000) Utilities (150,000) Management fee Cash balance at the end of the period (100,000) 400,000 Cost of production statement for the year ended 30 June 2019 Wages paid Wages payable Materials and supplies paid 500,000 200,000 700,000 350,000 Materials and supplies payable 150,000 Less: Materials and supplies on hand (100,000) 400,000 Utilities 300,000 Management fee Total production cost 100,000 1,500,000 Less: Undistributed Gold 666,667 Cost of gold distributed 833,333 Required: Prepare the required entries for Beers Ltd for the year ended 30 June 2019. The deferred exploration and evaluation expenditure had been recorded in the books of Beers Ltd at $600,000. The property plant and equipment contributed to the joint operation by Beers Ltd was originally purchased for $1,500,000 with accumulated depreciation of $700,000 at 1 July 2018. This asset is considered impaired. Beers Ltd decides not to revalue its remaining interest in the non-current assets contributed to the joint operation. The PPE contributed by Tiffany's was new and recorded at $3,000,000. Beers Ltd sold 80% of its gold for $200,000. The following was extracted from the accounting records kept by the joint operation manager for the year ending 30 June 2019. Joint operation balance sheet extract at 30 June 2019 Cash and cash equivalents 400,000 Supplies 100,000 Undistributed gold 666,667 Deferred exploration and evaluation expenditure 1,000,000 Property Plant and Equipment Accounts payable 7,500,000 (500,000) Net assets 9,166,667 Joint operation cash receipts and payments for the year ended 30 June 2019 Cash contributions from operators 5,500,000 Less: Cash payments Plant and Equipment (4,000,000) Wages (500,000) Materials and supplies (350,000) Wages (500,000) Materials and supplies (350,000) Utilities (150,000) Management fee Cash balance at the end of the period (100,000) 400,000 Cost of production statement for the year ended 30 June 2019 Wages paid Wages payable Materials and supplies paid 500,000 200,000 700,000 350,000 Materials and supplies payable 150,000 Less: Materials and supplies on hand (100,000) 400,000 Utilities 300,000 Management fee Total production cost 100,000 1,500,000 Less: Undistributed Gold 666,667 Cost of gold distributed 833,333 Required: Prepare the required entries for Beers Ltd for the year ended 30 June 2019.
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Entries tor Beers td 20 Contribulins made For joint arrngenent operation Fr... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-1118742976
16th edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield
Posted Date:
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