Account Titles and Explanation Debit Credit Date Account Titles and Explanation

Question

Account Titles and Explanation

Debit

Credit

Date

Account Titles and Explanation

Debit

Credit

Account Titles and Explanation

Debit

Credit

Presented below is information related to equipment owned by Carla Vista Company at December 31, 2017.
Cost $6,840,000 Accumulated depreciation to date 684,000 Expected future net cash flows 4,560,000 Fair value 3,192,000
Assume that Carla Vista will continue to use this asset in the future. As of December 31, 2017, the equipment has a remaining useful life of 4 years.

Explanation / Answer

a) Journal Entry :-

Calculation :-

b) Journal Entry :-

Depreciation Exp. = $4560000 / 4 years

= $1140000

c) Journal Entry :-

Calculation :-

= $3420000 - (4560000 - 1140000) = $0

Date Particulars Debit($) Credit($) Dec. 31, 2017 Loss on Impairment A/c Dr. 1596000 To Accumulated Depreciation - Equipment 1596000

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