The information that follows relates to equipment owned by Buffalo Limited at December 31, 2020: Cost...
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The information that follows relates to equipment owned by Buffalo Limited at December 31, 2020: 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) 1. 2. 3. At December 31, 2020, Buffalo discontinues use of the equipment and intends to dispose of it in the coming year by selling it to a competitor. It is expected that the costs of disposal will total $45,500. $8,190,000 Assume that Buffalo is a private company that follows ASPE. (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.) No. Account Titles and Explanation (1) (2) 910,000 (3) 6,370,000 5,778,500 5,642,000 45,500 Prepare the journal entry at December 31, 2020, to record asset impairment, if any. Prepare the journal entry to record depreciation expense for 2021. Assume that the asset was not sold by December 31, 2021. The equipment's fair value (and recoverable amount) on this date is $5.92 million. Prepare the journal entry, if any, to record the increase in fair value. It is expected that the costs of disposal will total $45,500. Debit Credit Repeat the requirements in (a) above assuming that Buffalo is a public company that follows IFRS, and that the asset meets all criteria for classification as an asset held for sale. (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.) (1) (2) (3) Account Titles and Explanation Debit Credit The information that follows relates to equipment owned by Buffalo Limited at December 31, 2020: 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) 1. 2. 3. At December 31, 2020, Buffalo discontinues use of the equipment and intends to dispose of it in the coming year by selling it to a competitor. It is expected that the costs of disposal will total $45,500. $8,190,000 Assume that Buffalo is a private company that follows ASPE. (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.) No. Account Titles and Explanation (1) (2) 910,000 (3) 6,370,000 5,778,500 5,642,000 45,500 Prepare the journal entry at December 31, 2020, to record asset impairment, if any. Prepare the journal entry to record depreciation expense for 2021. Assume that the asset was not sold by December 31, 2021. The equipment's fair value (and recoverable amount) on this date is $5.92 million. Prepare the journal entry, if any, to record the increase in fair value. It is expected that the costs of disposal will total $45,500. Debit Credit Repeat the requirements in (a) above assuming that Buffalo is a public company that follows IFRS, and that the asset meets all criteria for classification as an asset held for sale. (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.) (1) (2) (3) Account Titles and Explanation Debit Credit
Expert Answer:
Answer rating: 100% (QA)
1 Impairment loss 1638000 2 Depreciation expense 1128400 3 No entry made 1 Impairment loss 1501500 2 Depreciation expense 1155700 3 Revaluation gain o... View the full answer
Related Book For
Intermediate Accounting
ISBN: 978-0176509736
10th Canadian Edition, Volume 1
Authors: Donald Kieso, Jerry Weygandt, Terry Warfield, Nicola Young,
Posted Date:
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