Hippy Pty Ltd is a manufacturing company. On 1 January 2022, an item of equipment was...

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Hippy Pty Ltd is a manufacturing company. On 1 January 2022, an item of equipment was acquired at a cost of $90,000. The following information is provided: Relevant financial year 1 Jan 2022 to 30 June 2022 1 July 2022 to 30 June 2023 Initial/remaining useful life Note: 4 years 3.5 years 1. Narrations to journal are not required. 2. Show all relevant dates and workings. Estimated/revised residual value The directors of Hippy Pty Ltd have decided to depreciate the equipment on a straight-line basis and to adopt the revaluation model for the equipment from 30 June 2022 onwards. The directors have determined that the fair value of the equipment is $82,000 on 30 June 2022 and $56,800 on 30 June 2023. Ignore any tax effect. Required: $6,000 $6,750 i. Prepare journal entries to account for all transactions that took place during the period 1 January 2022 to 30 June 2023, including entries for the acquisition of the machine, depreciation and revaluations. (8 marks) ii. Refer to AASB116.29 that allows for alternative valuation when accounting for subsequent measurement of property, plant and equipment (PPE) and requires reporting entities to apply the same model to an entire class of PPE. Discuss a qualitative characteristic as provided in the Conceptual Framework, justifying how that can be related to the principles as given in AASB116.29. (2 marks) Hippy Pty Ltd is a manufacturing company. On 1 January 2022, an item of equipment was acquired at a cost of $90,000. The following information is provided: Relevant financial year 1 Jan 2022 to 30 June 2022 1 July 2022 to 30 June 2023 Initial/remaining useful life Note: 4 years 3.5 years 1. Narrations to journal are not required. 2. Show all relevant dates and workings. Estimated/revised residual value The directors of Hippy Pty Ltd have decided to depreciate the equipment on a straight-line basis and to adopt the revaluation model for the equipment from 30 June 2022 onwards. The directors have determined that the fair value of the equipment is $82,000 on 30 June 2022 and $56,800 on 30 June 2023. Ignore any tax effect. Required: $6,000 $6,750 i. Prepare journal entries to account for all transactions that took place during the period 1 January 2022 to 30 June 2023, including entries for the acquisition of the machine, depreciation and revaluations. (8 marks) ii. Refer to AASB116.29 that allows for alternative valuation when accounting for subsequent measurement of property, plant and equipment (PPE) and requires reporting entities to apply the same model to an entire class of PPE. Discuss a qualitative characteristic as provided in the Conceptual Framework, justifying how that can be related to the principles as given in AASB116.29. (2 marks)

Answer rating: 100% (QA)

i Journal entries for the period 1 January 2022 to 30 June 2023 1 January 2022 Equipment Asset Dr 90000 CashBank Cr 90000 Acquisition of equipment Dep... View the full answer