b. RoyCo acquired a brand new property (land and buildings) on 1 January 2016 for GH¢40 million (including GH¢15 million in respect of the land). The asset was revalued on 31 December 2017 to GH¢43 million (including GH¢16.6 million in respect of the land). The buildings element was depreciated over a 50-year useful life to a zero residual value. The useful life and residual value did not subsequently need revision. On 31 December 2018 the property was revalued downwards to GH¢35 million as a result of the recession (including GH¢14 million in respect of the land). The company makes a transfer from revaluation surplus to retained earnings in respect of realised profit. Required: Calculate the amounts recognised in profit or loss and in other comprehensive income for the years ended 31 December 2017 and 31 December 2018

Q: Mega Ltd acquired a three-story building for use as an office on 1 January 2016 at $2 million. The…

A: Carrying amount on 31 December 2016 = Cost - Depreciation = $2,000,000 - [($2,000,000-$200,000)/20…

Q: Question 25 of 30 . True or False - When creating a time slip in Sage 50, you can only enter the…

A: Time slip represents the records of the time spent by the employees on the activities of the…

Q: PT B purchased the production machine for Rp. 250,000,000 on January 1, 2013. The useful life and…

A: Depreciation is a bookkeeping strategy for dispensing the expense of a substantial or actual…

Q: A company which uses the revaluation model for its PPE bought a building on 1 January 2014 for…

A: In the given question, we need to compute the revaluation loss that would affect the statement of…

Q: Blossom Corporation uses the cost model to account for its property, plant, and equipment, which…

A: Straight-line depreciation evenly spreads the cost of an asset over its useful life, reducing its…

Q: On 1 July 2021, Mozart Ltd purchased three machines each used in a different production process in…

A: *As per the bartleby guidelines in case of different queestions answer first only   Calculation of…

Q: Hand Creamy Limited purchased a land for $150,000 cash on 1 September 2016 and a machine for…

A: a) Depreciation: Machinery = Cost/ life                    = $300,000/10 years                    =…

Q: Prepare the journal entry to account for the change in accounting estimate.

A: Depreciation is estimated value calculated on the basis of depreciation method and estimation of…

Q: On January 1, 2015, MARS Inc. acquired a real property consisting of a land with a building for…

A:

Q: Vaughn Company makes and sells artistic frames for pictures. The controller is responsible for…

A: Production budget :— This budget is prepared to estimate the number of units to be produced for…

Q: Easy-going company acquired some Plant at a cost of $1.5million. As at 30 June 2014 the plant had…

A: Impairment loss = Carrying value of the assets - Recoverable value of the assets where, Recoverable…

Q: On September 30, 2014, Leeds LTD, acquired a potent in conjunction with the purchase of another…

A: An intangible asset is an asset that is not physical in nature, such as a patent, brand, trademark,…

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.