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  3. question 3 part c question 2 accounting for noncurrent assets...

Question: question 3 part c question 2 accounting for noncurrent assets...

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QUESTION 3

 

  1. Part C Question 2 Accounting for Non-current Assets                                            

    On 1 July 2019 Fraser Ltd acquired an item of equipment with an acquisition cost of $810,000. The equipment can be used for 9 years.

    On 30 June 2020, the end of financial year, the fair value of the equipment was $738,000.

    The equipment was sold for $610,000 on 1 January 2021.

    Non-current asset is depreciated evenly over the useful life and has no residual value. The company uses the revaluation model to record non-current asset. The income tax rate is 30%. Ignore GST.

     

    Required:

    Prepare relevant journal entries to record non-current asset in 2019/2020 and 2020/2021 financial years in accordance with AASB 116 and AASB 136. (Narrations are required, tax effect entries are required.)      

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