On January 1, 2017, Epitome Company acquired the following property, plant and equipment: Cost Useful life Land Building Machinery Equipment 5,000,000 25,000,000 10,000,000 3,000,000 25 10 At the beginning of 2020, a revaluation of property, plant and equipment was made by professionally qualified valuers. While no change in the useful life of the assets was indicated, it was ascertained that replacement cost of the assets had increased by the following percentage: 100% Land Building Machinery Equipment 80% 50% 40% It was authorized that such revaluation be recorded in the accounts and that depreciation be recorded on the basis of revalued amount. Required: a. Prepare journal entry to record the revaluation on January 1, 2020. b. Prepare journal entry to record the depreciation for the current year. c. Prepare journal entry to record the piecemeal realization of the revaluation surplus.

On January 1, 2017, Epitome Company acquired the following property, plant and equipment: Cost Useful life Land Building Machinery Equipment 5,000,000 25,000,000 10,000,000 3,000,000 25 10 At the beginning of 2020, a revaluation of property, plant and equipment was made by professionally qualified valuers. While no change in the useful life of the assets was indicated, it was ascertained that replacement cost of the assets had increased by the following percentage: 100% Land Building Machinery Equipment 80% 50% 40% It was authorized that such revaluation be recorded in the accounts and that depreciation be recorded on the basis of revalued amount. Required: a. Prepare journal entry to record the revaluation on January 1, 2020. b. Prepare journal entry to record the depreciation for the current year. c. Prepare journal entry to record the piecemeal realization of the revaluation surplus.

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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