= $181,000

Fair value on 30/06/2011 is $172,000, so, $9000 of lose will be noted. The loss of $9000 represents the difference between the carry
Period 01/07/2011 to 30/06/2012
Now revised Depreciation of for balance for 9 years
= Cost – Depreciation – Revaluation Loss / Balance Years
= 200,000 – 19,000 – 9000 – 10,000 / 9
= $ 162,000/9
=$18,000
Revised Book Value of Machinery on 30.06.12
Date Particulars Debit($) Credit($)
= 200,000 – 19,000 – 9000 – 18,000
01/07/2010  Machinery A/c 200,000  
= $154,000 To Cash 200,000
(being paid in cash for machinery)
As booked value and Fair30/06/2011
value marked 
on 30/06/2012
Accumulated Depreciation
is same, therefore, no further  calculations and entry required.
19,000
Period 01/07/2012 to 31/12/2013 To Machinery (Being
 
Depreciation Calculated)  
 
19,000
 
Now revised
Date Depreciation of for balance
 for
Revaluation 8
Particulars years
Loss (P/L) on 30/06/2013  
9,000
 
Debit($)
  Credit($)
To Machinery A/c (Being
= Cost – Depreciation – Revaluation LossDepreciation
/ofBalance Years   9,000
30/06/2014  25,000  
revaluation machinery recorded in P/L)
Accumulated   A/c
= 200,000 – 19,000 – 9000 – 18,000 – 18,000 To Equipment A/c   25,000
= $136,000   30/06/2012    
 Accumulated Depreciation A/c 18,000  
= Fair value on 30/06/2013
 is $150,000, Losses
Impairment so, $14,000 ToA/c
Machinery ofA/cSurplus will be booked.   18,0000   
(Being Depreciation Calculated)    
Current revaluation gain is 14,000
Original (150,000
amount To Equipment
*Carrying amount– 136,000) FaceFMV,
is same as A/c Which
Value no need for will   reverse
250,000 10,000
previous
   
revaluation loss (by crediting profit and
Out of $14,000 surplus, we
Date Depreciation
(BeingYear
deduct earlier
Particulars
recognition $9000
of revaluation
loss,
Impairment which of is booked
Equipment) in Depreciation
Profit
Debit & Loss   Account.
Credit 10,000 remaining $5000 show
In addition,
01-07-2010 to on 30/06/2013   
30-06-2011 25,000
19,000 $
30 June 2015
Cost Of Machinery   31/12/13
on Accumulated impairment loss a/c $8750  
Depreciation
01-07-11 to on 30/06/2014
30-06-2012 25,000
18,000 $
30/06/15
   30/06/13
Original Cost Depreciation Reversal
Depreciation

of impairment
A/c
$200,000
Accumulated Depreciation
loss a/c  
18,000 23,750
  $8750  
  on
(Being 30/06/2015
reversal
01-07-2012 to 30-06-2013 To (Being of
EquipmentTo impairment
Machinery A/c
A/c loss.)     25,000
18,000 $ 
18,000    23,750
Depreciation on 30/06/2011
Ceiling $19,000 Depreciation Calculated)  
01-07-2013 to amount
31-12-2013
     $175,000
10,000 $     
Revaluation Loss on 30/06/2011 $9,000 Machinery A/c 14,000  
   
  9000
Depreciation on 30/06/12 $18,000 To Gain on revaluation (P/L)
To Revaluation   on Surplus(OCI) 5000  
Depreciation on 30/06/13 $18,000    
+ Revaluation Surplus on 30/06/2013 $14,000
31/12/2013  

=$150,000
Accumulated depreciation 10,000
 
 
 

Depreciation For 01/07/2013 to 31/12/13  

To(6 Month)
Machinery A/c  
 
10,000
 
 Cash 100,000  
Revaluation on Surplus(OCI) 5,000  
= 150,000-10,000 7 Years * 612 = Loss on sale of Machinery
To machinery A/C
35,000
$10,000 
 
140,000
Therefore there is a loss of $40,000  from the
 
sale, also we deduct $5,000 from the surplus noted last year 30/06/2012. Hence, tot
Machinery Depreciation Table Straight Line Method:
Journal Entries between 1 July 2010 and 31 December 2013
Part B) Provide any necessary journal entries related to the impairment of the item of equipmen
Calculations:
Impairment of losses will be booked, if recoverable amount is less than carrying amount.