Reference no: EM132858926

Camenzuli and Family Ltd operates a rabbit farm on the outskirts of north-western Sydney. At the commencement of the 2021/22 financial year the following rabbits were owned:

Mature rabbits with a fair value of: $80,000
One month old rabbits with a fair value of $5,000

1. The following events occurred during the course of the 2021/22 financial year: $6,000 was spent on food and water for the rabbits;
2. The mature rabbits were harvested (humanely) on 1 March 2022. At the point of harvest the fair value of the harvested rabbits was $106,000. The cost to harvest the rabbits was $5,000 and the estimated selling costs was zero.
3. Half of the rabbit meat was sold to customers on 5 March 2022 for $60,000. The other half of the rabbit meat was processed into rabbit sausages on 6 March at a cost of $12,000. All the sausages were sold to customers on 10 March 2022 for $75,000.
4. At the end of the 2022 financial year the one month old rabbits had matured and had an estimated fair value of $95,000.

Required

Problem 1: Provide all necessary entries to record the above events during the 2021/22 financial year.