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  3. 1. alpha co. purchased a machine on 1 july 2013 fo

1. Alpha Co. purchased a machine on 1 July 2013 for $80,000 which had a...

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Accounting

1. Alpha Co. purchased a machine on 1 July 2013 for $80,000 which had a useful life of ten years and is depreciated on a straight-line basis. A fire at the factory on 1 October 2016 caused damages to the machine. The chief accountant considered doing an impairment test as the damage had downgraded the machines operating capacity. The accountant has provided the following information on 1 October 2016:

  1. Under current conditions, the machine would generate a total of $38,685 in present value for three years.
  2. The machine could be sold in its current condition for $45,000 with a cost of $2,000.
  3. Alpha Co. has a year-end on 31 December.

With relevant accounting standards, explain and show how Alpha Co. would conduct an impairment test on the machine on 1 October 2016

2 .Beta Corporation purchased a machine for $70m on 1 January 2016 that had a useful life of fifteen years and is depreciated on a straight-line basis. On 1 January 2019, the asset was revalued to $85m.

Applying accounting standards, compute all the relevant items to be shown in the financial statements of Beta Co. for the year ended 31 December 20X9.

note , please write with explaination

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