Presented below is information related to equipment owned by Pujols Company at December 31, 2014.
| Cost (residual value $0) |
|
$9,000,000 |
|
| Accumulated depreciation to date |
|
1,000,000 |
|
| Value-in-use |
|
5,500,000 |
|
| Fair value less cost of disposal |
|
4,400,000 |
|
Assume that Pujols will continue to use this asset in the future. As of December 31, 2014, the equipment has a remaining useful life of 8 years. Pujols uses straight-line depreciation.
The recoverable amount of the equipment at December 31, 2015, is $6,050,000. Prepare the journal entry (if any) necessary to record this increase. (If no entry is required, select "No entry" for the account titles and enter 0 for the amounts. Credit account titles are automatically indented when amount is entered. Do not indent manually.)