Sea shores is a property investment company that focuses on buying landing and buildings for purposes for rental and resale purposes. The company currently own the following land and buildings.   Use Purchase date Depreciation policy cost Model Fair value on 31 Dec 2020 Braamfontein land Rented to the local municipality 30 June 2019   10  000 000 Fair value 14 000 000 Umhlanga building Consists of 50 apartments 30 apartments are rented to tenants 01 May 2020 20% on cost 20 000 000 Cost 25 000 000 Richards bay building Will be sold on appreciation of the value 30 April 2020 ? 8 400 000 cost 8 400 000 Richards Bay land Occupied by sea shores 1 January 2020   12 000 000 Cost 10 000 000 Pretoria Building Rented to tenants 1 February 2019 20% on cost 8 000 000 Fair value 10 545 800   Required Prepare all the necessary journal entry for the year ended 31 December 2020.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Sea shores is a property investment company that focuses on buying landing and buildings for purposes for rental and resale purposes. The company currently own the following land and buildings.

 

Use

Purchase date

Depreciation policy

cost

Model

Fair value on

31 Dec 2020

Braamfontein land

Rented to the local municipality

30 June 2019

 

10  000 000

Fair value

14 000 000

Umhlanga building

Consists of 50 apartments 30 apartments are rented to tenants

01 May 2020

20% on cost

20 000 000

Cost

25 000 000

Richards bay building

Will be sold on appreciation of the value

30 April 2020

?

8 400 000

cost

8 400 000

Richards Bay land

Occupied by sea shores

1 January 2020

 

12 000 000

Cost

10 000 000

Pretoria Building

Rented to tenants

1 February 2019

20% on cost

8 000 000

Fair value

10 545 800

 

Required

Prepare all the necessary journal entry for the year ended 31 December 2020.  

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Section 179 Deduction and Modified Accelerated Cost Recovery System (MACRS) Depreciation
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