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What date can the machinery be reclassified as non-current

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Reference no: EM132785642

Limited corp owns a machine which is used to produce herbal medicine. The machine was originally purchased for IDR 50,000,000 on January 1, 2016. The machine has an estimated useful life of 10 years and a residual value of IDR 0.

On July 31, 2018, the company decided to sell the machine and replace it with more modern equipment. Even so, production activities for new machines were stopped on January 1, 2019. On that date, the company had also only been actively marketing machines at a reasonable price. If the machine is sold, the company believes it can get IDR 33,000,000, before deducting the selling cost of 10% of the selling price.

Instructions:

Problem a. At what date can the machinery be reclassified as non-current assets held for sale?

Problem b. What journal is required at the asset reclassification date!

Problem c. As of December 31, 2019, the assets have not been successfully sold. The company decided to return to using the assets in production activities. It is known that the recoverable amount of assets is Rp32,000,000. what journal is required!

Reference no: EM132785642

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