Question :

The subsequent information relates to Property, Equipment and Plant held by Black Limited as at 30 June 2010 financial statements:

Land - at fair value $2 500 000

Plant - at cost $1 000 000

Less Accumulated depreciation ($100 000)  900 000

There have been no disposals or additions to Land for the year, Land consist of one property in Suva. The Plant consists of 4 machines each purchased on 1 July 2009 for $250 000 with a helpful life of 10 years and depreciated on a straight line basis.

On 1^st January 2011, one of the machines was sold as there was excess capability due to a downturn in the market for $200 000.

The fair value of the Land was assessed to be $2 800 000 as at 30^th June 2011. It was noted that there had been a prior decrement of $100 000 recorded in the earlier year.

Due to a downturn in the market value the recoverable amount of the machines are now supposed to be $150 000 each as at 30 June 2011.

Required:

(a) Purpose all the journal entries for the above transactions for 1^st July 2010 to 30 June 2011.