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Good evening sir!
my question relates to example 10 in the link below.
The gain double entry is given as:
Dr Asset
Dr Accum. dep
Cr Reval Reserve (RR)however, in this example
the entry is
Dr Accum Dep
Cr NCA cost
Cr RRcan u please explain this?
regards
We need to eliminate the accumulated depreciation, so …
Dr Accumulated depreciation $15,000
Cr Revaluation reserve $15,000and we need to reduce the balance in the asset account from $100,000 down to $98,000, so …
Dr Revaluation reserve $2,000
Cr Asset account $2,000The net journal entry works out to:
DrAccumulated depreciation $15,000
Cr Asset account $2,000
Cr Revaluation reserve $13,000Is that better?
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