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please explain how to treat the following:
details of land and building at 31st march 2005 are:
land at cost=$1000
building at cost=$4000
Less:Accumulated Depreciation at 31st march 2005=$800
therefore, building=$3200at the beginning of the current year (1st april 2004), XYZ had an open market valuation of its properties. land was valued at $ 1200, and the building at $ 4800. the directors wish these values to be incorporated into the financial statements. the properties had an estimated remaining life of 20years at the date of the valuation (straight line depreciation is used). XYZ makes a transfer to realised profits in respect of the excess depreciation on revalued assets.
Can you tell me which paper did you take this question from? The question doesn’t make much sense, if you are saying that the asset was revalued at the beginning of the year, how come at the end of the year it has accumulated deprecation and “cost” details? Are you sure you got your dates right? I think the cost and depreciation details were meant to be at the beginning of the year.. in fact, these numbers are very familiar to me and I think I solved this Q just yesterday, can you confirm which question is this? Maybe if I read the full question I will be able to help.
I have to say, I am not so perfect in F7 and specially the TNCA bits, so let’s see what Mr Mike will say, maybe I have missed something out.
Thanks, Maha
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