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hi, I have problem with revaluation loss charged against Revaluation reserves.Here are the past paper.
https://www.accaglobal.com/content/dam/acca/global/PDF-students/2012/p2int_2010_jun_q.pdf
https://www.accaglobal.com/content/dam/acca/global/PDF-students/2012/p2int_2010_jun_a.pdf
Working 6
I understand how to calculate revaluation gain, excess depreciation.
On balance sheet it would be :CR PPE 3.56m
DR P/L 1.60m
DR Reval.Res. 1.96mIn answer I see there is charged loss of 1.6m. This is ok.
Now in Other comprehensive income there is revaluation adjustment of 1.60m? I thought it should be 1.96m loss not a gain of 1.60m??? Can someone explain me this?yes, as per the question: “the whole of the revaluation loss had been posted to the Statement of Comprehensive Income”. And if you look at the income statements in the question, revaluations (net) is in OCI. So the original entry put the whole lot into OCI:
Dr OCI $3.56m
Cr PPE $3.56mThe *real* entries should’ve been:
Dr OCI $1.96m
Dr Income Statement $1.6m
Cr PPE $3.56mTherefore, to correct the error:
Dr Income Statement $1.6m
Cr OCI $1.6mIf you look at Working 1 in the answer, you can see the $1.6m debit to the main body of the income statement, which has its corresponding credit in OCI.
I think overall, “Ashanti” has got to be one of the most fiendish Q1’s ever set!
thank you fidget for helping me,putting together both posts i got it eventually where my mistake was.
https://opentuition.com/topic/help-needed-on-revaluation-gain-in-income-statement-2/#post-121584
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