Revaluation of asset

In consolidated retained earnings calculation (working W3) increase the retained earnings of the subsidiary by $4,000 and decrease that same retained earnings figure by the accumulated depreciation that would have been charged on that asset since acquisition by $4,000/20 * number of years since acquisition

You didn’t say whether the subsidiary was acquired during the current year so the paragraph above suggests that it was acquired some time ago. If that had been three years ago, that accumulated depreciation deduction would be 3 * $200 = $600

If it had been acquired at the start of the current financial year, the depreciation would be just 1*$200 = $200

If the asset revaluation had taken place as at date of acquisition the $4,000 increase would also have appeared in working W2 Goodwill as an increase in the fair value of subsidiary net assets at date of acquisition

If the revaluation had taken place after the acquisition of the subsidiary, that would be a post acquisition increase and would not be within the goodwill calculation

If you are asked to prepare the consolidated statement of profit or loss, the current year’s subsidiary results would need to be decreased by this year’s depreciation on that $4,000 increase ie by $200

Of course, if the subsidiary had been prepared to amend its own figures as at date of acquisition and bring the asset value to fair value, none of these depreciation adjustments would have been necessary … but that’s most unlikely to be the situation in an F7 exam

Does that answer you?