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Thanks,
Sorry I forgot add the depreciation, I would:
Depreciation incurred (50,000,000/20):
Dr. Depreciation expense 2, 500, 000
Cr. Accum depreciation 2, 500, 000then clear the accum depreciation because this should be 0 in the revaluation model:
Dr. Accum depr 2, 500, 000And for the leasehold property, in a t-account the cost is compared with the current revaluation (50, 000,000- 43, 000, 000)
Cr. Leasehold property 7,000,000The revaluation is a loss because I took the cost- accum depreciation and got the net book value then compared it to the revalued figure given. (47, 500, 000- 43, 000, 000)
Dr. Revaluation reserve 4,500, 000.
I looked at the pg 241 answer but I don’t understand why lease property is credited with 4, 500, 000 and why accum depreciation is not cleared to 0?
If my answer is wrong could you please explain the answer because I’m really confused.
Also how do I reply to your post, it normally doesn’t allow me to. Would I just need to keep a opening new topic?
Many Thanks.
The IAS doesn’t appear to me to be desperately clear on this although it does talk about “depreciation” and “carrying value” even when referring to the valuation model
I don’t think there’s anything wrong with:
Dr Depreciation expense 2.5
Dr Revaluation reserve 4.5
Cr TNCA 7.0You can’t respond to the posts – too many students we’re simply adding unrelated questions onto existing threads, so I close each thread now as I reply to it
If all you wanted to say was “Thank you”, please don’t worry – I’ll assume that you are appreciative 🙂
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