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Question - Choochoo Limited bought a train for Rs. 1,000,000 on 01 January 2018, in cash. It is considered to have two significant parts, the costs of which have been estimated as follows:
Engine: Rs. 250,000
Carriages: Rs. 550,000
The balance of the train is constituted by various moving parts, non-moving parts and chairs in some of the carriages. These remaining parts are individually insignificant.
Required - (With reference to Property, Plant and Equipment IAS 16)
Show the journal entry to record the purchase of the train. Present the train in Choochoo Limited's detailed statement of financial position on the date of acquisition.
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