On 31 december 2009 the directors of sydney ltd decided to

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Reference no: EM13576069

In the 30 June 2009 annual report of Sydney Ltd, the equipment was reported as follows:$Equipment 500,000.
Accumulated depreciation :350,000

The equipment consisted of two machines, Machine A and Machine B. Machine A had cost $300,000 and had a carrying amount of $180,000 at 30 June 2009, and Machine B had cost $200,000 and was carried at $170,000. Both machines are measured using the cost model and depreciated on a straight-line basis over a 10-year period.

On 31 December 2009, the directors of Sydney Ltd decided to change the basis of measuring the equipment from the cost model to the revaluation model. Machine A was revalued to $180,000 with an expected remaining useful life of 6 years, and Machine B was revalued to $155,000 with an expected remaining useful life of 5 years.

At 30 June 2010, Machine A was assessed to have a fair value of $163,000 with an expected remaining useful life of 5 years, and Machine B's fair value was $136,500 with an expected remaining useful life of 4 years.

Required: Prepare the journal entries during the period 1 July 2009 to 30 June 2010 in relation to the equipment.

Reference no: EM13576069

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