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Tongas Company applies revaluation accounting to plant assets with a carrying value of $1,600,000, a useful life of 4 years, and no salvage value. Depreciation is calculated on the straight-line basis. At the end of year 1, independent appraisers determine that the asset has a fair value of $1,500,000.   39) The journal entry to adjust the plant assets to fair value in year one will include a a) debit to Accumulated Depreciation for $100,000. b) credit to Depreciation Expense for $300,000. c) credit to Plant Assets for $300,000. d.)  credit to Unrealized Gain on Revaluation for $300,000

Tongas Company applies revaluation accounting to plant assets with a carrying value of $1,600,000, a useful life of 4 years, and no salvage value. Depreciation is calculated on the straight-line basis. At the end of year 1, independent appraisers determine that the asset has a fair value of $1,500,000.   39) The journal entry to adjust the plant assets to fair value in year one will include a a) debit to Accumulated Depreciation for $100,000. b) credit to Depreciation Expense for $300,000. c) credit to Plant Assets for $300,000. d.)  credit to Unrealized Gain on Revaluation for $300,000

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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Tongas Company applies revaluation accounting to plant assets with a carrying value of $1,600,000, a useful life of 4 years, and no salvage value. Depreciation is calculated on the straight-line basis. At the end of year 1, independent appraisers determine that the asset has a fair value of $1,500,000.

 

39) The journal entry to adjust the plant assets to fair value in year one will include a

a) debit to Accumulated Depreciation for $100,000.

b) credit to Depreciation Expense for $300,000.

c) credit to Plant Assets for $300,000.

d.)  credit to Unrealized Gain on Revaluation for $300,000

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