Question:1. Assume that Glory Company applies revalution at the end of December 31. year to Building...
Question
1. Assume that Glory Company applies revalution at the end of December 31. year to Building...
1. Assume that Glory Company applies revalution at the end of December 31. year to Building purchased on June 1. your 7 for Bir 2,000,000. The Building has a useful life of 20 years and no residual value. Required: a) Record adjusting entry for depreciation on December 31. year 7 using straight line method b) At the end of year 7. independent appraisers determine that the asset has a fair value of Birr 1.980,000.record the equipment at fair value c) At the end of year 8, independent appraisers determine that the asset hus a fair value of Biry 1.775.000 at the end of Year 8. record the equipment at fair value. d) At the end of year 9. independent appraisers determine that the asset has a fair value of Bin 2.100,000 at the end of Year 9 record the equipment in fair value.
A gain on revaluation is always
recognised in equity, under a revaluation reserve
The revaluation gain is known as an
unrealised gain which later becomes realised when the asset is
disposed of (derecognised)
Revaluation
losses
A revaluation loss should be charged
against any related revaluation surplus to the extent that the
decrease does not exceed the amount held in the revaluation surplus
in respect of the same asset. Any additional loss must be charged
as an expense in the statement of profit or loss.
Depreciation
The asset must continue to be
depreciated following the revaluation. However, now that the asset
has been revalued the depreciable amount has changed. In simple
terms the revalued amount should be depreciated over the assets
remaining useful life
1 4. Beginning inventory and purchases and sales data for Commodity "X" for the month of July are as follow Inventory 25 units Br 50 Sales July 7 15 units rss 18 10 G Br 58 27 12 units Br 62 Purchases 20 units 51 20 15 units 52 1) Compute the cost of ending inventory and cost of goods sold using FIFO and AVC under a) Periodic inventory system b) Perpetual inventory system 2) Pass the necessary journal entry...
Assume that on December 31, 2016, Waste Management,
Inc. signs an 8-year noncancelable lease agreement to
lease a building from Reyes Warehouse Company. The following
information pertains to this lease agreement.
1.
The agreement requires equal
rental payments of $73,530 beginning on December 31, 2016.
2.
The fair value of the
building on December 31, 2016, is $465,000.
3.
The building has an estimated
economic life of 10 years, a guaranteed residual value at the end
of 8 years of...
Assume that on December 31, 2019, Kimberly-Clark Corp signs a 10 year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company The following information pertains to this lease agreement 1 The agreement requires equal rental payments of $67,199 beginning on December 31, 2019. 2 The fair value of the building on December 31, 2019 is $491.847 3 The building has an estimated economic life of 12 years, a guaranteed residual value of $10,500, and an expected residual...
Assume that on December 31, 2019, Kimberly-Clark
Corp. signs a 10-year, non-cancelable lease agreement to
lease a storage building from Sheffield Storage Company. The
following information pertains to this lease agreement.
1.
The agreement requires equal rental payments of $67,299
beginning on December 31, 2019.
2.
The fair value of the building on December 31, 2019 is
$492,571.
3.
The building has an estimated economic life of 12 years, a
guaranteed residual value of $10,500, and an expected residual
value...
Bison Transportation has a December 31 year end and uses
straight-line depreciation for all
property, plant and equipment. On July 1, 2012, the company
purchased equipment on account for
$500,000. The equipment had an expected useful life of 10 years and
no residual value.
On December 31, 2015, after recording depreciation, Bison reviewed
its equipment for possible
impairment. Bison determined that the equipment had a recoverable
amount of $225,000.
a) Prepare the journal entries to record the asset purchase in...
Exercise 21A-4 a-d
Assume that on December 31, 2016, Kimberly-Clark
Corp. signs a 10-year, non-cancelable lease agreement to
lease a storage building from Sheffield Storage Company. The
following information pertains to this lease agreement:
1.
The agreement requires equal rental payments of $67,899
beginning on December 31, 2016.
2.
The fair value of the building on December 31, 2016 is
$497,614.
3.
The building has an estimated economic life of 12 years, a
guaranteed residual value of $12,000, and an...
(Lessee Entries; Finance Lease and Unguaranteed Residual Value)
Assume that on December 31, 2016, Kimberly-Clark Corp. signs a
10-year, non-cancelable lease agreement to lease a storage building
from Sheffield Storage Company. The following information pertains
to this lease agreement.
1. The agreement requires equal rental payments of $71,830
beginning on December 31, 2016.
2. The fair value of the building on December 31, 2016, is
$525,176.
3. The building has an estimated economic life of 12 years, a
guaranteed residual...
Exercise 21A-4 a-d Assume that on December 31, 2016, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement: 1. The agreement requires equal rental payments of $66,499 beginning on December 31, 2016. 2. The fair value of the building on December 31, 2016 is $486,311. 3. The building has an estimated economic life of 12 years, a guaranteed residual value of $9,500, and an...
E21-4 (L02,4) EXCEL (Lessee Entries, Finance Lease and Unguaranteed Residual Value) Assume that on December 31, 2016, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement. 1. The agreement requires equal rental payments of $71,830 beginning on December 31, 2016. 2. The fair value of the building on December 31, 2016, is $525,176. 3. The building has an estimated economic life of 12 years,...
Assume that on December 31, 2016, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement: The agreement requires equal rental payments of $68,299 beginning on December 31, 2016 The fair value of the building on December 31, 2016 is $500,513 1. 2. The building has an estimated economic life of 12 years, a guaranteed residual value of $12,000, and an expected residual value of...
1 4. Beginning inventory and purchases and sales data for Commodity "X" for the month of July are as follow Inventory 25 units Br 50 Sales July 7 15 units rss 18 10 G Br 58 27 12 units Br 62 Purchases 20 units 51 20 15 units 52 1) Compute the cost of ending inventory and cost of goods sold using FIFO and AVC under a) Periodic inventory system b) Perpetual inventory system 2) Pass the necessary journal entry...
Assume that on December 31, 2019, Kimberly-Clark Corp signs a 10 year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company The following information pertains to this lease agreement 1 The agreement requires equal rental payments of $67,199 beginning on December 31, 2019. 2 The fair value of the building on December 31, 2019 is $491.847 3 The building has an estimated economic life of 12 years, a guaranteed residual value of $10,500, and an expected residual...
Assume that on December 31, 2019, Kimberly-Clark
Corp. signs a 10-year, non-cancelable lease agreement to
lease a storage building from Sheffield Storage Company. The
following information pertains to this lease agreement.
1.
The agreement requires equal rental payments of $67,299
beginning on December 31, 2019.
2.
The fair value of the building on December 31, 2019 is
$492,571.
3.
The building has an estimated economic life of 12 years, a
guaranteed residual value of $10,500, and an expected residual
value...
Exercise 21A-4 a-d
Assume that on December 31, 2016, Kimberly-Clark
Corp. signs a 10-year, non-cancelable lease agreement to
lease a storage building from Sheffield Storage Company. The
following information pertains to this lease agreement:
1.
The agreement requires equal rental payments of $67,899
beginning on December 31, 2016.
2.
The fair value of the building on December 31, 2016 is
$497,614.
3.
The building has an estimated economic life of 12 years, a
guaranteed residual value of $12,000, and an...
Exercise 21A-4 a-d Assume that on December 31, 2016, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement: 1. The agreement requires equal rental payments of $66,499 beginning on December 31, 2016. 2. The fair value of the building on December 31, 2016 is $486,311. 3. The building has an estimated economic life of 12 years, a guaranteed residual value of $9,500, and an...
E21-4 (L02,4) EXCEL (Lessee Entries, Finance Lease and Unguaranteed Residual Value) Assume that on December 31, 2016, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement. 1. The agreement requires equal rental payments of $71,830 beginning on December 31, 2016. 2. The fair value of the building on December 31, 2016, is $525,176. 3. The building has an estimated economic life of 12 years,...
Assume that on December 31, 2016, Kimberly-Clark Corp. signs a 10-year, non-cancelable lease agreement to lease a storage building from Sheffield Storage Company. The following information pertains to this lease agreement: The agreement requires equal rental payments of $68,299 beginning on December 31, 2016 The fair value of the building on December 31, 2016 is $500,513 1. 2. The building has an estimated economic life of 12 years, a guaranteed residual value of $12,000, and an expected residual value of...