Fast Movers Ltd Purchased a Machine on the First Day

question 51

Multiple Choice

Fast Movers Ltd purchased a machine on the first day of their financial year: 1 January 2002. The machine cost $75 000 and has an expected useful life of 10 years at which time its salvage value will be $8000. An even pattern of benefits is expected to be derived from the machine. Then on 31 December 2005 (3 years later) the machine is sold for $65 000. What are the appropriate journal entries to record the disposal of the machine in line with the requirements of AASB 116?

---

Definitions:

Certification

The process of verifying that a person has met predetermined qualifications or standards, often involving formal assessment and the issuance of a certificate or credential.

Dodd-Frank Act

A comprehensive US financial reform legislation passed in 2010 to reduce systemic risk and increase transparency in the financial system.

Securities Exchange Act

A U.S. federal law that regulates the trading of securities such as stocks and bonds in the secondary market, ensuring transparency and fairness.

Misstatement

An error or inaccuracy in stating facts or details, often found in financial accounts or reports.