Revaluation of assets: On 30th June 20X1, the statement of financial position of Uranus Ltd showed the following noncurr
Posted: Thu May 26, 2022 7:13 am
Revaluation of assets:
On 30th June 20X1, the statement of financial position of Uranus
Ltd showed the following noncurrent assets after charging
depreciation:
Building
$ 300
000
Accumulated depreciation (100 000)
$200 000
Motor Vehicle
120 000
Accumulated depreciation (40 000)
80 000
The company has adopted fair value for the valuation of
non-current assets. This has resulted in the recognition in
previous periods of an asset revaluation reserve for the building
of $14 000. On 30 June 20X1, an independent value assessed the fair
value of the building to be $160 000 and the vehicle to be $90
0000. The income tax rate is 30%.
Required:
1. Prepare the necessary entries t revalue the building and the
vehicle as at 30 June 20X1.
2. Assume that building and vehicle had remaining useful lives
of 25 years and 4 years respectively, with zero residual value.
Prepare entries to record depreciation expense for the year ended
30 June 20X2 using the SLM.
On 30th June 20X1, the statement of financial position of Uranus
Ltd showed the following noncurrent assets after charging
depreciation:
Building
$ 300
000
Accumulated depreciation (100 000)
$200 000
Motor Vehicle
120 000
Accumulated depreciation (40 000)
80 000
The company has adopted fair value for the valuation of
non-current assets. This has resulted in the recognition in
previous periods of an asset revaluation reserve for the building
of $14 000. On 30 June 20X1, an independent value assessed the fair
value of the building to be $160 000 and the vehicle to be $90
0000. The income tax rate is 30%.
Required:
1. Prepare the necessary entries t revalue the building and the
vehicle as at 30 June 20X1.
2. Assume that building and vehicle had remaining useful lives
of 25 years and 4 years respectively, with zero residual value.
Prepare entries to record depreciation expense for the year ended
30 June 20X2 using the SLM.