On January 1, 2023, llumber Ltd. acquires a building at a cost of $210,000. The building is expected to have a 20-year life and no residual value. The asset is accounted for under the revaluation model, using the asset adjustment method. Revaluations are carried out every three years. On December 31, 2025, the fair value of the building is appraised at $185.000, and on December 31, 2025, its fair value is $120,000. Cullumber applies IFRS.
On January 1, 2023, llumber Ltd. acquires a building at a cost of $210,000. The building is expected to have a 20-year life and no residual value. The asset is accounted for under the revaluation model, using the asset adjustment method. Revaluations are carried out every three years. On December 31, 2025, the fair value of the building is appraised at $185.000, and on December 31, 2025, its fair value is $120,000. Cullumber applies IFRS.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Prepare the journal entries required on December 31, 2025, and the journal entry required on December 31, 2028, to revalue the
building, if Cullumber uses the proportionate method. (Credit account titles are automatically indented when the amount is entered. Do
not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts. List all debit entries before
credit entries. Do not round intermediate calculations. Round final answers to O decimal places, e.g. 5,275.)
Account Titles and Explanation
Date
Debit
5
Cr
Transcribed Image Text:On January 1, 2023, Cullumber Ltd. acquires a building at a cost of $210,000. The building is expected to have a 20-year life and no
residual value. The asset is accounted for under the revaluation model, using the asset adjustment method. Revaluations are carried
out every three years. On December 31, 2025, the fair value of the building is appraised at $185,000, and on December 31, 2025, its
fair value is $120,000. Cullumber applies IFRS.
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