Reference no: EM132366603

Question

Exercise 01 - Analysing the sale of a non-current asset On 2 January 2018, Ditto Clothing Consignments purchased showroom fixtures for $12000 cash, expecting the fixtures to remain in service for five years. Ditto has depreciated the fixtures on a straight-line basis, with zero residual value. On 30 September 2019, Ditto sold the fixtures for $6200 cash. Requirement Record both depreciation for 2019 and the sale of the fixtures on 30 September 2019, assuming that Ditto's financial year ends 30 June (ignore GST).

Exercise 02 - Disposal of non-current assets Presented here are selected transactions for Cox Ltd for 2019. Jan 1 Scrapped a piece of machinery that was purchased on 1 January 2009. The machine cost $78 000 and had a useful life of 10 years with no residual value. June 30 Sold office equipment that was purchased on 1 January 2016. The equipment cost $73 500 and had a useful life of 5 years with no residual value. The office equipment was sold for $30 000. Dec. 31 Discarded a delivery truck that was purchased on 1 January 2015. The truck cost $40 500 and was depreciated based on an 8-year useful life with a $4500 residual value. Required Journalise all entries required on the above dates, including entries to update depreciation on assets disposed of, where applicable. Cox Ltd uses straight-line depreciation. The financial year-end is 31 December.