Advanced Accounting 10th Edition by Thomas Schaefer, Joe Ben Hoyle, Timothy Doupnik

Exercise 21

Problems 15-19 are based on the Comprehensive Illustration at the end of the chapter.
Ramshare Company acquired equipment at the beginning of 2011 at a cost of $100,000.The equipment has a five-year life with no expected salvage value and is depreciated on a straight-line basis.At December 31, 2011, Ramshare compiled the following information related to this equipment:
a.Determine the amount at which Ramshare should carry this equipment on its December 31, 2011, balance sheet and the amount, if any, that it should report in net income related to this inventory using (1) U.S.GAAP and (2) IFRS.
b.Determine the adjustments that Ramshare would make in 2011 and 2012 to reconcile net income and stockholders' equity under U.S.GAAP to IFRS.Ignore the possibility of any additional impairment at the end of 2010.