FUNDAMENTAL ACCOUNTING PRINCIPLES
FUNDAMENTAL ACCOUNTING PRINCIPLES
24th Edition
ISBN: 9781260811704
Author: Wild
Publisher: MCG
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Chapter F, Problem 6E
To determine

Concept Introduction:

International financial reporting framework (IFRS):

International financial reporting framework is the accounting framework/ accounting standards followed internationally to prepare the financial statements. IFRS are issued by the International Accounting Standards Board (IASB). IFRS fulfill the objective of common accounting standards worldwide.

United States generally accepted Accounting Policies (US GAAP):

United States generally Accepted Accounting Policies is the accounting framework/ accounting standards followed in the United States to prepare the financial statements. US GAAPS are issued by Financial Accounting Standards Board (FASB).

Requirement-1:

To Prepare:

The journal entry to record the depreciation expense on Property, plant, and equipment

Expert Solution
Check Mark

Answer to Problem 6E

The journal entry to record the depreciation expense on Property, plant, and equipment is as follows:

    Journal entries
    Account Titles Debit Credit
    Depreciation Expense7,509
    Accumulated Depreciation 7,509

Explanation of Solution

The journal entry to record the depreciation expense on Property, plant, and equipment is explained as follows:

    Journal entries
    Account Titles Debit Credit
    Depreciation Expense7,509
    Accumulated Depreciation 7,509
    (Being depreciation expense recorded)
To determine

Concept Introduction:

International financial reporting framework (IFRS):

International financial reporting framework is the accounting framework/ accounting standards followed internationally to prepare the financial statements. IFRS are issued by the International Accounting Standards Board (IASB). IFRS fulfill the objective of common accounting standards worldwide.

United States generally accepted Accounting Policies (US GAAP):

United States generally Accepted Accounting Policies is the accounting framework/ accounting standards followed in the United States to prepare the financial statements. US GAAPS are issued by Financial Accounting Standards Board (FASB).

Requirement-2:

To Prepare:

The journal entry to record the addition to Property, plant, and equipment

Expert Solution
Check Mark

Answer to Problem 6E

The journal entry to record the addition to Property, plant, and equipment is as follows:

    Journal entries
    Account Titles Debit Credit
    Property, plant, and equipment 11,560
    Cash 11,560
    (Being addition to Property, plant, and equipment recorded)

Explanation of Solution

The journal entry to record the addition to Property, plant, and equipment is explained as follows:

    Journal entries
    Account Titles Debit Credit
    Property, plant, and equipment 11,560
    Cash 11,560
    (Being addition to Property, plant, and equipment recorded)
To determine

Concept Introduction:

International financial reporting framework (IFRS):

International financial reporting framework is the accounting framework/ accounting standards followed internationally to prepare the financial statements. IFRS are issued by the International Accounting Standards Board (IASB). IFRS fulfill the objective of common accounting standards worldwide.

United States generally accepted Accounting Policies (US GAAP):

United States generally Accepted Accounting Policies is the accounting framework/ accounting standards followed in the United States to prepare the financial statements. US GAAPS are issued by Financial Accounting Standards Board (FASB).

Requirement-3:

To Prepare:

The journal entry to record the disposal of Property, plant, and equipment

Expert Solution
Check Mark

Answer to Problem 6E

The journal entry to record the disposal of Property, plant, and equipment is as follows:

    Journal entries
    Account Titles Debit Credit
    Cash 720
    Accumulated Depreciation 1,195
    Loss on Disposal 515
    Property, plant, and equipment 2,430

Explanation of Solution

The journal entry to record the disposal of Property, plant, and equipment is explained as follows:

    Journal entries
    Account Titles Debit Credit
    Cash 720
    Accumulated Depreciation 1,195
    Loss on Disposal (2430-1195-720) 515
    Property, plant, and equipment 2,430
    (Being disposal of Property, plant, and equipment recorded)
To determine

Concept Introduction:

International financial reporting framework (IFRS):

International financial reporting framework is the accounting framework/ accounting standards followed internationally to prepare the financial statements. IFRS are issued by the International Accounting Standards Board (IASB). IFRS fulfill the objective of common accounting standards worldwide.

United States generally accepted Accounting Policies (US GAAP):

United States generally Accepted Accounting Policies is the accounting framework/ accounting standards followed in the United States to prepare the financial statements. US GAAPS are issued by Financial Accounting Standards Board (FASB).

Requirement-4:

To Indicate:

The effect of the Impairment on the value of Property, plant, and equipment

Expert Solution
Check Mark

Answer to Problem 6E

The Impairment shall reduce the net value of Property, plant, and equipment by 143.

Explanation of Solution

The journal entry to record the impairment of Property, plant, and equipment is explained as follows:

    Journal entries
    Account Titles Debit Credit
    Loss on Impairment 143
    Property, plant, and equipment 143
    (Being Impairment loss recorded)

Hence, the Impairment shall reduce the net value of Property, plant, and equipment by 143.

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