How would this problem be solved under US GAAP VS IAS what would be the differen

Question

How would this problem be solved under US GAAP VS IAS what would be the difference?

8.New legislation was promulgated on 1 September 20x1 whereby all public transport buses are required to undergo regular major inspections every 2 years. Vroom Limited owns a bus that has a carrying amount of $80,000 as at 1 January 20X1. This bus is depreciated on the straight-line method to a nil residual value and had a remaining useful life of 10 years on 1 Janua on 1 October 20X1 at a cost of $20,000. ry 20x1. A major inspection of this bus was performed Required: Show the journal entry relating to the major inspection and pr the detailed statement of financial position of Vroom Limited as at 31 Decenher esent the bus in

Explanation / Answer

Date Account Debit Credit Oct 1 2011 Bus Major Inspection - Cost 20000 Cash 20000 (major inspection cost recognized as bus) Dec 31 2011 Depreciation Bus 10500 Accumulated Depreciation-Bus 8000 80000/10 Accumulated Depreciation-Bus Major Inspection 2500 (20000/2 year life)*3 Month (being depreciation recorded) Financial Position: Assets: Non Current Assets Bus (80000+20000-10500) 89500

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