Following a delayering exercise, Carter vacated an office building and let it out to a third party on 30 June 2018. The building had an original cost of GHS900,000 on 1 January 2010 and was being depreciated over 50 years. It was judged to have a fair value on 30 June 2018 of GHS950,000. At the year end date of 31 December 2018 the fair value of the building was estimated at GHS1.2 million. Carter uses the fair value model for investment property. What amount will be shown in revaluation surplus at 31 December 2018 in respect of this building?

Following a delayering exercise, Carter vacated an office building and let it out to a third party on 30 June 2018. The building had an original cost of GHS900,000 on 1 January 2010 and was being depreciated over 50 years. It was judged to have a fair value on 30 June 2018 of GHS950,000. At the year end date of 31 December 2018 the fair value of the building was estimated at GHS1.2 million. Carter uses the fair value model for investment property. What amount will be shown in revaluation surplus at 31 December 2018 in respect of this building?

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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Question

Following a delayering exercise, Carter vacated an office building and let it out
to a third party on 30 June 2018. The building had an original cost of
GHS900,000 on 1 January 2010 and was being depreciated over 50 years. It
was judged to have a fair value on 30 June 2018 of GHS950,000. At the year
end date of 31 December 2018 the fair value of the building was estimated at
GHS1.2 million. Carter uses the fair value model for investment property. What
amount will be shown in revaluation surplus at 31 December 2018 in respect
of this building?

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