Mendelssons Ltd Has a Machine That Has Been Revaluing Over

question 5

Multiple Choice

Mendelssons Ltd has a machine that has been revaluing over a number of years.The valuation as at 1 January 2002 is $130,000.The previous valuation was $145,000 and the accumulated depreciation is $40,000.The revised salvage value is $15,000 and the estimated useful life remaining is 12 years.The benefits from the machine are expected to be derived evenly over its life.In the previous year,the machine had been devalued by $15,000 and this amount written off to the income statement.What are the entries at 1 January 2002 to record the revaluation and at 31 December 2002 to record depreciation?

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Definitions:

Unclearly Defined Office Procedures

Office or administrative processes which are not explicitly explained or documented, leading to confusion and inefficiency among staff.

Budget Line

A graphical representation of all possible combinations of two goods that can be purchased with a given budget.

Investor's Choice

The selection made by an investor regarding where, how, and in what to invest their money, based on factors like risk, return, and personal objectives.

Risk

The potential for losing something of value or the uncertainty regarding the outcome of an action, often associated with the potential for financial loss.