On September 30, 2018, the Company exchanged old delivery equipment and RM24,000 cash for new delivery equipment. The old delivery equipment was purchased on January 1, 2016 for RM84,000 and was estimated to have a RM12,000 residual value at the end of its 5-year life. Depreciation on the delivery equipment has been recorded through December 31, 2017. It is estimated that the fair value of the old delivery equipment is RM39,000 on September 30, 2018 Required: Prepare the journal entries to record the above transactions for the Company which has a calendar year end and uses the straight-line method of depreciation. Show all workings.
On September 30, 2018, the Company exchanged old delivery equipment and RM24,000 cash for new delivery equipment. The old delivery equipment was purchased on January 1, 2016 for RM84,000 and was estimated to have a RM12,000 residual value at the end of its 5-year life. Depreciation on the delivery equipment has been recorded through December 31, 2017. It is estimated that the fair value of the old delivery equipment is RM39,000 on September 30, 2018 Required: Prepare the journal entries to record the above transactions for the Company which has a calendar year end and uses the straight-line method of depreciation. Show all workings.
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter8: Operating Assets: Property, Plant, And Equipment, And Intangibles
Section: Chapter Questions
Problem 8.6E
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