Diamond Ltd acquired an item of polishing equipment on 1 July 2015 for $440,000. The equipment is
Question:
Diamond Ltd acquired an item of polishing equipment on 1 July 2015 for $440,000. The equipment is expected to have a useful life of 10 years and the straight-line method of depreciation is to be used. It has a salvage value of $40,000. On 1 July 2017, the equipment is deemed to have a fair value of $424,000, and revaluation is undertaken in accordance with the Diamond Ltd policy of measuring property, plant, and equipment at fair value. The asset is still usable for the next 8 years but the salvage value is determined to be zero. The asset is sold for $356,000 on 1 July 2019.
Required:
Provide the journal entries necessary at the following dates to account for the above transactions and events. Show your workings.
a. 01/07/2015
b. 01/07/2017
c. 01/07/2019
Accounting
ISBN: 978-0324662962
23rd Edition
Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren