QUESTION - On 1 July 2011, Aaron Ltd purchased equipment for $4,000,000. The company uses the revaluation model to account for equipment and depreciates it over its estimated useful life of 4 years using the straight line method with a zero residual. Indicators of impairment and/or reversal of impairment existed at 30 June 2012, 2013 and 2014.
The information below shows the asset values at various dates.
|
Date
|
Fair Value
|
Cost to Sell
|
Value in Use
|
|
30/06/2012
|
2,910,000
|
50,000
|
2,950,000
|
|
30/06/2013
|
1,940,000
|
80,000
|
1,880,000
|
|
30/06/2014
|
1,140,000
|
40,000
|
1,160,000
|
Prepare general journal entries to account the equipment from 1 July 2011 to 30 June 2014 in accordance with the requirements of AASB 116 and AASB 136. Please show all workings.