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Daniel [21]
3 years ago
15

ABC Catering​, purchased equipment for $ 12 comma 000. ABC recorded total depreciation of $ 9 comma 000 on the equipment. Assume

that ABC exchanged the old equipment for new​ equipment, paying $ 3 comma 200 cash. The fair market value of the new equipment is $ 5 comma 800. Journalize ABC's exchange of equipment. Assume this exchange has commercial substance
Business
1 answer:
NNADVOKAT [17]3 years ago
5 0

Answer:

New Equipment $5,800 (debit)

Old Equipment - Accumulated depreciation $9,000 (credit)

Old Equipment at Cost $12,000 (credit)

Gain on echange of Equipment $2,800 (credit)

Explanation:

Accoring to IAS 16 :

If a transaction has a <em>commercial substance</em>,

Acquired Equipment is measured at fair value of asset given up. ( if fair values of acquired and given up asset can be determined reliably)

If fair value of Asset Acquired is more evidentn then Asset acquired is measured at fair value of Asset Acquired.

<u>JOURNAL</u>

New Equipment $5,800 (debit)

Old Equipment - Accumulated depreciation $9,000 (credit)

Old Equipment at Cost $12,000 (credit)

Gain on echange of Equipment $2,800 (credit)

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<u />

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8 0
2 years ago
When a large supply of a product is available for sale, the price of the product will often
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Answer:A

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5 0
2 years ago
Read 2 more answers
Wheeler’s Bike Company manufactures custom racing bicycles. The company uses a job order cost system to determine the cost of ea
kirill [66]

Answer:

predetermined overhead rate: 14.51 dollars per labor hour

applied overhead at 18,500 hours: 268,435 dollars

Explanation:

\frac{Cost\: Of \:Manufacturing \:Overhead}{Cost \:Driver}= Overhead \:Rate

we distribute the expected overhead over the cost dirver. In this case direct labor hour:

cost driver: labor hours:

labor cost: 231,322 / 12.71 labor rate = 18,200 labor hours

<u>expected overhead:</u>

depreciaiton 53,500

supervisor    135,000

supplies         42,900

property tax   32,750

total overhead 264,150‬

overhead rate: 264,150 / 18,200 = 14,51373626373626 = 14.51/hr.

applied: 18,500 x 14.51 = 268.435‬

3 0
3 years ago
Corey, a supervisor, needs to rate the performance of 20 subordinates. He uses a rating scale to rate them on a scale of 1 to 10
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Answer:

central tendency distributional error

Explanation:

There are three types of distributional errors:

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3 years ago
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