Answered: ABC Ltd has the following land and…

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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ABC Ltd has the following land and buildings in its financial statements as of 30 June 2022: Residential land, at cost 2,553,800 Factory land, at valuation 2020 2,298,420 Buildings, at valuation 2020 2,043,040 Accumulated depreciation -255,380 At 30 June 2022, the balance of the revaluation surplus is $1,021,520, of which $766,140 relates to the factory land and $255,380 to the buildings. On this same date, independent valuations of the land and buildings are obtained. In relation to the above assets, the assessed fair values at 30 June 2022 are: Residential land, previously recorded at cost 2,809,180 Factory land, previously revalued in 2020 1,787,660 Buildings, previously revalued in 2020 2,298,420 Required: Provide the journal entries to account for the revaluation on 30 June 2022. ABC Ltd classifies the residential land and the factory land as different classes of assets.

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