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The following information is relevant for Questions 7.16 and 7.17. Gusna Co purchased a building on 31 December 20x1 for $750,000. At the date of acquisition, the useful life of the building was estimated to be 25 years and depreciation is calculated using the straight-line method. At 31 December 20X6, an independent valuer valued the building at $1,000,000 and the revaluation was recoenised in the financial statements. Gusna's accounting policies state that excess depreciation arising on revaluation of non-current assets can be transferred from the revaluation surplus to retained earnings. 7.16 What is the depreciation charge on the building for the year ended 31 December 20X7? $40,000 $50,000 $30,000 $42,500 A C 7.17 From the list of tokens below, identify the correct debit / credit entries to record the transfer of excess FFA/FA FINANCIAL ACCOUNTING depreciation. TOKEN CREDIT ENTRY DEBIT ENTRY Retained earnings $20,000 Debit entry 000,0ea Revaluation surplus Credit entry $20,000 Revaluation surplus $12,500 Retained earnings $12,500 7.18 Which of the following should be disclosed for tangible non-current assets according to IAS 16 Property. Plant and Equipment? 1 Depreciation methods used and the total depreciation allocated for the period 2 A reconciliation of the carrying amount of non-current assets at the beginning and end period

The following information is relevant for Questions 7.16 and 7.17. Gusna Co purchased a building on 31 December 20x1 for $750,000. At the date of acquisition, the useful life of the building was estimated to be 25 years and depreciation is calculated using the straight-line method. At 31 December 20X6, an independent valuer valued the building at $1,000,000 and the revaluation was recoenised in the financial statements. Gusna's accounting policies state that excess depreciation arising on revaluation of non-current assets can be transferred from the revaluation surplus to retained earnings. 7.16 What is the depreciation charge on the building for the year ended 31 December 20X7? $40,000 $50,000 $30,000 $42,500 A C 7.17 From the list of tokens below, identify the correct debit / credit entries to record the transfer of excess FFA/FA FINANCIAL ACCOUNTING depreciation. TOKEN CREDIT ENTRY DEBIT ENTRY Retained earnings $20,000 Debit entry 000,0ea Revaluation surplus Credit entry $20,000 Revaluation surplus $12,500 Retained earnings $12,500 7.18 Which of the following should be disclosed for tangible non-current assets according to IAS 16 Property. Plant and Equipment? 1 Depreciation methods used and the total depreciation allocated for the period 2 A reconciliation of the carrying amount of non-current assets at the beginning and end period

FINANCIAL ACCOUNTING
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 7.17 please explained in detail.

The following information is relevant for Questions 7.16 and 7.17. Gusna Co purchased a building on 31 December 20x1 for $750,000. At the date of acquisition, the useful life of the building was estimated to be 25 years and depreciation is calculated using the straight-line method. At 31 December 20X6, an independent valuer valued the building at $1,000,000 and the revaluation was recoenised in the financial statements. Gusna's accounting policies state that excess depreciation arising on revaluation of non-current assets can be transferred from the revaluation surplus to retained earnings. 7.16 What is the depreciation charge on the building for the year ended 31 December 20X7? $40,000 $50,000 $30,000 $42,500 A C
Transcribed Image Text:The following information is relevant for Questions 7.16 and 7.17. Gusna Co purchased a building on 31 December 20x1 for $750,000. At the date of acquisition, the useful life of the building was estimated to be 25 years and depreciation is calculated using the straight-line method. At 31 December 20X6, an independent valuer valued the building at $1,000,000 and the revaluation was recoenised in the financial statements. Gusna's accounting policies state that excess depreciation arising on revaluation of non-current assets can be transferred from the revaluation surplus to retained earnings. 7.16 What is the depreciation charge on the building for the year ended 31 December 20X7? $40,000 $50,000 $30,000 $42,500 A C
7.17 From the list of tokens below, identify the correct debit / credit entries to record the transfer of excess FFA/FA FINANCIAL ACCOUNTING depreciation. TOKEN CREDIT ENTRY DEBIT ENTRY Retained earnings $20,000 Debit entry 000,0ea Revaluation surplus Credit entry $20,000 Revaluation surplus $12,500 Retained earnings $12,500 7.18 Which of the following should be disclosed for tangible non-current assets according to IAS 16 Property. Plant and Equipment? 1 Depreciation methods used and the total depreciation allocated for the period 2 A reconciliation of the carrying amount of non-current assets at the beginning and end period
Transcribed Image Text:7.17 From the list of tokens below, identify the correct debit / credit entries to record the transfer of excess FFA/FA FINANCIAL ACCOUNTING depreciation. TOKEN CREDIT ENTRY DEBIT ENTRY Retained earnings $20,000 Debit entry 000,0ea Revaluation surplus Credit entry $20,000 Revaluation surplus $12,500 Retained earnings $12,500 7.18 Which of the following should be disclosed for tangible non-current assets according to IAS 16 Property. Plant and Equipment? 1 Depreciation methods used and the total depreciation allocated for the period 2 A reconciliation of the carrying amount of non-current assets at the beginning and end period
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