8.19 Banter Co purchased an office building on 1 January 20X1. The building cost was $1,600,000 and this was depreciated by the straight line method at 2% per year, assumine a 50-vear life and hi e value. The building was re-valued to $2,250,000 on 1 January 20x5 The usefuul life was not reviseu. The excess depreciation charge will be transferred from the revaluation surplus to retained earnings each year. The company's financial year ends on 31 December. What is the balance on the revaluation surplus at 31 December 20X6? %24

8.19 Banter Co purchased an office building on 1 January 20X1. The building cost was $1,600,000 and this was depreciated by the straight line method at 2% per year, assumine a 50-vear life and hi e value. The building was re-valued to $2,250,000 on 1 January 20x5 The usefuul life was not reviseu. The excess depreciation charge will be transferred from the revaluation surplus to retained earnings each year. The company's financial year ends on 31 December. What is the balance on the revaluation surplus at 31 December 20X6? %24

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Description: was depreciated by the straight line method at 2% per year, assumine a 50-vear life and ni Teswalue. The building was re-valued to $2,250,000 on 1 January 20x6. The useful life was not tenThe excess depreciation charge will be transferred from the r

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Depreciation Methods

The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.

Depreciation Accounting

In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.

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Question

was depreciated by the straight line method at 2% per year, assumine a 50-vear life and ni Tes
walue. The building was re-valued to $2,250,000 on 1 January 20x6. The useful life was not ten
The excess depreciation charge will be transferred from the revaluation surplus to retained earnings each
year. The company's financial year ends on 31 December.
What is the balance on the revaluation surplus at 31 December 20X6?
%24
42
8.19 Banter Co an on 1 January 20X1. The cost was and ths

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