Make the journal entries to account for the events

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On 1 July 2015, Bright Ltd paid $65,000 cash to acquire an item of machinery. It was estimated that the item of machinery had a useful life of 8 years and a residual value of $5,000. Bright Ltd uses the revaluation model to measure items of property, plant and equipment and the straight-line method of depreciation. Bright Ltd has a 30 June reporting date.

An independent valuer provided the following fair values for the item of machinery:

Reporting date Fair value

30 June 2016 $57,500

30 June 2017 53,000

30 June 2018 40,000

On 1 July 2019, the item of machinery was sold for $35,000 cash.

Required

Question 1: Prepare the journal entries to account for the events and transactions in relation to the item of machinery between 1 July 2015 and 1 July 2019. For any year/s that a revaluation journal entry is not required, you should explain this and provide a supporting calculation.

Reference no: EM132549868

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