Final answer:
The question asks for journal entries under U.S. GAAP and IFRS and a conversion worksheet entry for converting U.S. GAAP balances to IFRS, illustrating accounting differences in equipment treatment.
Step-by-step explanation:
The question pertains to the preparation of journal entries for equipment accounting under both U.S. GAAP and IFRS for the years ending December 31, 2023, and December 31, 2024. It also requires the creation of a journal entry for the conversion worksheet to convert U.S. GAAP balances to IFRS at the end of 2024. The specific entries would depend on the initial cost of the equipment, the method of depreciation, the estimated useful life, and the salvage value of the asset. Under U.S. GAAP, firms have options such as straight-line, declining balance, or sum-of-the-years-digits methods for depreciation, while IFRS often prefers the component approach and may use a different useful life or salvage value for the asset.
To illustrate, let's assume a piece of equipment was purchased for $10,000 with a useful life of 5 years and a salvage value of $2,000. The annual depreciation under the straight-line method would be ($10,000 - $2,000) / 5 = $1,600. Thus, the journal entry for December 31, 2023, and 2024 would be:
Dr. Depreciation Expense $1,600
Cr. Accumulated Depreciation - Equipment $1,600
The conversion worksheet entry at the end of 2024 would typically adjust the accumulated depreciation and possibly the carrying amount of the equipment if the depreciable base or useful life differ under IFRS.