On January 1, 2020, Contentie following information related to the land and building: Land Building Accumulated depreciation-building 50,000,000 450,000,000 75,000,000 There were no additions or disposals during the current year. Depreciation is computed using straight line over 15 years for building. On June 30, 2020 the land and building were revalued. Replacement cost Sound value Land Building 65,000,000 480,000,000 1. What is the revaluation surplus on June 30, 2020? 65,000,000 600,000,000 a. 135,000,000 b. 125,000,000 c. 120,000,000 d. 160,000,000 2. What is the depreciation of the building for 2020? a. 30,000,000 b. 35,000,000 c. 40,000,000 d. 32,000,000 3. What is the revaluation surplus on December 31, 2020? a. 125,000,000 b. 130,000,000 c. 123,750,000 d. 115,000,000
On January 1, 2020, Contentie following information related to the land and building: Land Building Accumulated depreciation-building 50,000,000 450,000,000 75,000,000 There were no additions or disposals during the current year. Depreciation is computed using straight line over 15 years for building. On June 30, 2020 the land and building were revalued. Replacement cost Sound value Land Building 65,000,000 480,000,000 1. What is the revaluation surplus on June 30, 2020? 65,000,000 600,000,000 a. 135,000,000 b. 125,000,000 c. 120,000,000 d. 160,000,000 2. What is the depreciation of the building for 2020? a. 30,000,000 b. 35,000,000 c. 40,000,000 d. 32,000,000 3. What is the revaluation surplus on December 31, 2020? a. 125,000,000 b. 130,000,000 c. 123,750,000 d. 115,000,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
1. A. 135,000,000
2. B. 40,000,000
3. B. 130,000,000
Question: How do we solve for item number 3? I'm having a hard time getting 130,000,000. Is the revaluation surplus for land also allocated? Solution for item number 1 is found below and for item number 2:
= 480M sound value / 12 years remaining life
= 40,000,000
Please show solution and explanation, thank you!
Transcribed Image Text:Problem 29-9 (PHILCPA Adapted)
On January 1, 2020, Contentious Company provided the
following information related to the land and building:
Land
Building
Accumulated depreciation-building
50,000,000
450,000,000
75,000,000
There were no additions or disposals during the current year.
Depreciation is computed using straight line over 15 years
for building.
On June 30, 2020 the land and building were revalued.
Replacement cost Sound value
65,000,000
480,000,000
65,000,000
600,000,000
Land
Building
1.- What is the revaluation surplus on June 30, 2020?
a 135,000,000
b. 125,000,000
c. 120,000,000
d. 160,000,000
2. What is the depreciation of the building for 2020?
a. 30,000,000
b. 35,000,000
c. 40,000,000
d. 32,000,000
3. What is the revaluation surplus on December 31, 2020?
a. 125,000,000
b. 130,000,000
c. 123,750,000
d. 115,000,000
![1. REVALUATION
Land
Building
ACC DOP
SURPLUS, 06/30/22
Original
50,000,000
=
Revalued
65,000,000
amount
450,000,000 600,000,000
150,000,000
90,000,000) (120,000,000) 30,000,000)
360,000,000 480,000,000
120,000,000 (6)
carrying
sound
value
Updating the AD, Cost
X
= 75,000,000 + [(450,000,000) × 6/12]
161247
= 75,000,000 + (30,000,000 x 6/12)
= 75,000,000 + 15,000,000
90,000,000
Adjustment
15,000,000 (a)
Revaluation
surpus
Total Revaluation SURPlus
(a) 15,000,000
(b) 120,000,000 €135,000,000
10000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff82a0189-a001-438e-8e10-429fbfe68738%2Ff4da4262-01fc-453f-a465-517065a2464a%2F7jvk60x_processed.jpeg&w=3840&q=75)
Transcribed Image Text:1. REVALUATION
Land
Building
ACC DOP
SURPLUS, 06/30/22
Original
50,000,000
=
Revalued
65,000,000
amount
450,000,000 600,000,000
150,000,000
90,000,000) (120,000,000) 30,000,000)
360,000,000 480,000,000
120,000,000 (6)
carrying
sound
value
Updating the AD, Cost
X
= 75,000,000 + [(450,000,000) × 6/12]
161247
= 75,000,000 + (30,000,000 x 6/12)
= 75,000,000 + 15,000,000
90,000,000
Adjustment
15,000,000 (a)
Revaluation
surpus
Total Revaluation SURPlus
(a) 15,000,000
(b) 120,000,000 €135,000,000
10000
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