### Land Revaluation Accounting: Example of Waterway Ltd.**Scenario:**Waterway Ltd. purchased land at a cost of ¥464,000 in 2020. The company uses revaluation accounting to assess the land's value each year. The following valuation is provided in thousands of yen as of December 31 for each year:- **2020:** ¥522,000- **2021:** ¥417,600- **2022:** ¥446,600- **2023:** ¥475,600- **2024:** ¥533,600**Instructions:**Complete the table considering positive and negative fluctuations. Use a negative sign or parentheses to indicate negative amounts (e.g., -45 or (45)).**Revaluation Table:**| Value at December 31 | Other Comprehensive Income | Accumulated Other Comprehensive Income | Recognized in Net Income ||----------------------|----------------------------|--------------------------------------|-------------------------|| **2020** | ¥58,000 | ¥58,000 | ¥58,000 || **2021** | (¥46,400) | (¥46,400) | (¥46,400) || **2022** | (¥17,400) | (¥17,400) | (¥17,400) || **2023** | ¥11,600 | ¥11,600 | ¥11,600 || **2024** | ¥69,600 | ¥69,600 | ¥69,600 |**Explanation:**- **Other Comprehensive Income:** Reflects the annual changes in the land's value due to revaluation. Positive values indicate an appreciation in land value, while negative values reflect depreciation.- **Accumulated Other Comprehensive Income:** Represents the cumulative total of the comprehensive income adjustments over the years.- **Recognized in Net Income:** The amount recognized as net income, identical to the yearly Other Comprehensive Income adjustments under revaluation accounting.

Revaluation accounting is the process of determining an asset's current fair value by reevaluating…

Current Attempt in Progress Your answer is partially correct. Waterway Ltd. owns land that it purchased at a cost of ¥464,000 in 2020. The company chooses to use revaluation accounting to account for the land. The land's value fluctuates as follows (all amounts in thousands as of December 31): 2020, ¥522,000; 2021, ¥417,600; 2022, *446,600; 2023, 475,600; and 2024, 533,600. Complete the following table. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Value at December 31 2020 2021 2022 2023 2024 Other Comprehensive Income 58000 (46400) (17400) 11600 69600 Accumulated Other Comprehensive Income 58000 (46400) (17400) 11600 69600 Recognized in Net Income 58000 (46400) (17400) 11600 69600

Current Attempt in Progress Your answer is partially correct. Waterway Ltd. owns land that it purchased at a cost of ¥464,000 in 2020. The company chooses to use revaluation accounting to account for the land. The land's value fluctuates as follows (all amounts in thousands as of December 31): 2020, ¥522,000; 2021, ¥417,600; 2022, *446,600; 2023, 475,600; and 2024, 533,600. Complete the following table. (Enter negative amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Value at December 31 2020 2021 2022 2023 2024 Other Comprehensive Income 58000 (46400) (17400) 11600 69600 Accumulated Other Comprehensive Income 58000 (46400) (17400) 11600 69600 Recognized in Net Income 58000 (46400) (17400) 11600 69600

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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