Machine A Machine B Machine C Cost 48,000 Useful Life 8 years Cost 70,000 Useful Life 8 years Cost 85,000 Useful Life 10 years The firm uses the valuation model for all three assets. At 30 June 2020, the fair values of all assets were assessed. Machine A had a fair value of $50,000, and Machine B a fair value of $60,000. The remaining useful lives were assessed to be 6 years for Machine A and 5 years for Machine B. At this time the value of Machine C was unchanged. At 30 June 2021, Machine C was sold for a consideration of $72,000. On the same date the fair values of Machine A and Machine B were reassessed. Machine A had a fair value of $30,000, and Machine B a fair value of $50,000. Required: Prepare the journal entries for Steven Ltd for the years ending 30 June 2020 and 2021. Assume a tax rate of 30%.

Machine A Machine B Machine C Cost 48,000 Useful Life 8 years Cost 70,000 Useful Life 8 years Cost 85,000 Useful Life 10 years The firm uses the valuation model for all three assets. At 30 June 2020, the fair values of all assets were assessed. Machine A had a fair value of $50,000, and Machine B a fair value of $60,000. The remaining useful lives were assessed to be 6 years for Machine A and 5 years for Machine B. At this time the value of Machine C was unchanged. At 30 June 2021, Machine C was sold for a consideration of $72,000. On the same date the fair values of Machine A and Machine B were reassessed. Machine A had a fair value of $30,000, and Machine B a fair value of $50,000. Required: Prepare the journal entries for Steven Ltd for the years ending 30 June 2020 and 2021. Assume a tax rate of 30%.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter7: Operating Assets

Section: Chapter Questions

Problem 67E

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