FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Amber Company applies revaluation accounting to plant assets with a carrying value of $800,000, a useful life of 4 years, and no salvage value.
a) Please make journal entries for the year 2019.
b) Please make
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- In the 30 June 2020 annual report of Smith Ltd, the building was reported as follows: Building (at cost) Accumulated depreciation O The building is depreciated on a straight-line basis over a 10-year period. The company used revaluation model for the building. The company finds out that the building has a fair value of $140,000 at 30 June 2020. On 30 June 2021, the fair value of building is assessed to be $92,500. Asset Revaluation Surplus (OCI) Loss on Revaluation (P/L) Building Which journal entries are correct to revalue the asset in accordance with AASB 116 Property, Plant and Equipment at 30 June 2021? Building Gain on Revaluation (P/L) $ 150 000 Loss on Revaluation (P/L) Building (30 000) Asset Revaluation Surplus (OCI) Loss on Revaluation (P/L) Building 120 000 DR 20,000 27,500 DR 7,500 DR 30,000 DR 20,000 10,000 CR 47,500 CR 7,500 CR 30,000 CR 30,000arrow_forwardOn January 1, 2019, Ivanhoe Corporation acquired equipment at a cost of $858000. Ivanhoe adopted the sum-of-the-years’-digits method of depreciation for this equipment and had been recording depreciation over an estimated life of 8 years, with no residual value. At the beginning of 2022, a decision was made to change to the straight-line method of depreciation for this equipment. The depreciation expense for 2022 would be $171600. $107250. $44688. $71500.arrow_forwardWeber Enterprises purchased a depreciable asset on June 30, 2016 at a cost of $100,000. The asset is expected to have a salvage value of $15,000 at the end of its five-year useful life. It uses the double declining balance method of depreciation. Weber Enterprises should recognize what amount of salvage value in 2019?arrow_forward
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