Ask about Ques 2 in Dec 2011 Exam

Leasehold property cost 50,000, accumulated amortisation is 10,000, original estimated useful life is 20 years Therefore there is only 16 more years left to amortise "Why Revaluation Reserve on SoFP is $5,600,000 whereas I thought it is $8,000,000?" Do you think it might have anything to do with the deferred tax on the revaluation at 30%?

Yes, please explain to me, can you show me transaction entries when recognised deferred tax?

The carry forward liability on the deferred tax account increases by 2.4 But that 2.4 relates to a revaluation so there is a credit entry in the deferred tax account of 2.4 and the debit entry goes to the revaluation reserve Have you tried the mini exercises towards the end of the course notes? There are 16 exercises ALL lifted from past examination questions starting on page 217 Do those and will never need to write to me again with reference to deferred tax!

Thanks for your supporting!

You're welcome