Reference no: EM133144783

Question - Waterway Manufacturing operates a small factory building. Recently, the company paid some amounts related to its property, plant, and equipment. Waterway paid $45,000 to replace part of the factory floor. The floor had been capitalized as part of the factory building when it was purchased ten years previously and was not considered a separate component. When purchased, the building had been assumed to have a 30-year useful life and was being depreciated on a straight-line basis. At the time of the floor replacement, the building had been depreciated for 10 years. Waterway estimated that the original cost of the floor would have been 15% cheaper than the new replacement, due to inflation. Prepare the journal entries to record these transactions, assuming Waterway follows IFRS.