Ask Question
23 April, 15:45

On July 31, 2021, the company donated this machine to the Mountain King City Council. The fair value of the machine at the time of the donation was estimated to be $1,430,000. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

+2
Answers (1)
  1. 23 April, 15:57
    0
    Answer & Explanation:

    Depreciation a/c ... dr

    Loss a/c ... dr

    Charity a/c ... dr

    To machine a/c

    Machine amount = Machine cost value (eg, lets suppose = 2,000,000) Charity amount = fair value of machine at time of donation = 1,4300,000. It is the amount that could have been otherwise received on machine sale, but is given as charity. Accumulated depreciation is the total depreciation on machine upto date (eg, lets suppose = 5,00,000) Loss = (Machine cost - accumulated depreciation) - current fair value

    Eg: If cost = 2,000,000 & accumulated depreciation = 5,00,000. Machine value should be = 2,000,000 - 5,00,000 = 15,000,000. The fall in value from 15,000,000 to 1,430,000 = 70,000 is loss on machine disposal.
Know the Answer?
Not Sure About the Answer?
Find an answer to your question 👍 “On July 31, 2021, the company donated this machine to the Mountain King City Council. The fair value of the machine at the time of the ...” in 📗 Business if the answers seem to be not correct or there’s no answer. Try a smart search to find answers to similar questions.
Search for Other Answers