Reference no: EM132678540
A partial statement of financial position of Carla Vista Ltd. on December 31, 2016, showed the following property, plant, and equipment assets accounted for under the cost model (accumulated depreciation includes depreciation for 2016):
Buildings $300,000
Less: accumulated depreciation 100,000 $200,000
Equipment $131,000
Less: accumulated depreciation 51,000 80,000
Carla Vista uses straight-line depreciation for its building (remaining useful life of 20 years, no residual value) and for its equipment (remaining useful life of 8 years, no residual value). Carla Vista applies IFRS and has decided to adopt the revaluation model for its building and equipment, effective December 31, 2016. On this date, an independent appraiser assessed the fair value of the building to be $148,000 and that of the equipment to be $102,000.
Problem (a) Prepare the necessary general journal entries, if any, to revalue the building and the equipment as at December 31, 2016, using the asset adjustment method. (Credit account titles are automatically indented when the amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)
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