The information that follows relates to equipment owned by Bonita Limited at December 31, 2023: Cost...
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The information that follows relates to equipment owned by Bonita Limited at December 31, 2023: Cost Accumulated depreciation to date Expected future net cash flows (undiscounted) Expected future net cash flows (discounted, value in use) Fair value Costs to sell (costs of disposal) $9,360,000 1,040,000 7,280,000 6,604,000 6,448,000 52,000 Assume that Bonita will continue to use this asset in the future. As at December 31, 2023, the equipment has a remaining useful life of four years. Bonita uses the straight-line method of depreciation. Assume that Bonita is a private company that follows ASPE. 1. 2. 3. Prepare the journal entry at December 31, 2023, to record asset impairment, if any. Prepare the journal entry to record depreciation expense for 2024. The equipment's fair value at December 31, 2024, is $6.76 million. Prepare the journal entry, if any, to record the increase in fair value. Repeat the requirements in part (a) above assuming that Bonita is a public company that follows IFRS. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) No. Date (1) December 31, 2023 (2) December 31, 2024 (3) December 31, 2024 Account Titles and Explanation Loss on Impairment Accumulated Impairment Losses - Equipment Depreciation Expense Accumulated Depreciation - Equipment Accumulated Impairment Losses - Equipment Recovery of Loss from Impairment Debit Credit The information that follows relates to equipment owned by Bonita Limited at December 31, 2023: Cost Accumulated depreciation to date Expected future net cash flows (undiscounted) Expected future net cash flows (discounted, value in use) Fair value Costs to sell (costs of disposal) $9,360,000 1,040,000 7,280,000 6,604,000 6,448,000 52,000 Assume that Bonita will continue to use this asset in the future. As at December 31, 2023, the equipment has a remaining useful life of four years. Bonita uses the straight-line method of depreciation. Assume that Bonita is a private company that follows ASPE. 1. 2. 3. Prepare the journal entry at December 31, 2023, to record asset impairment, if any. Prepare the journal entry to record depreciation expense for 2024. The equipment's fair value at December 31, 2024, is $6.76 million. Prepare the journal entry, if any, to record the increase in fair value. Repeat the requirements in part (a) above assuming that Bonita is a public company that follows IFRS. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before credit entries.) No. Date (1) December 31, 2023 (2) December 31, 2024 (3) December 31, 2024 Account Titles and Explanation Loss on Impairment Accumulated Impairment Losses - Equipment Depreciation Expense Accumulated Depreciation - Equipment Accumulated Impairment Losses - Equipment Recovery of Loss from Impairment Debit Credit
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Answer rating: 100% (QA)
1 Prepare the journal entry at December 31 2023 to record asset impairment if any To determine if there is an impairment loss we compare the carrying ... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-1119048534
11th Canadian edition Volume 1
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Nicola M. Young, Irene M. Wiecek, Bruce J. McConomy
Posted Date:
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