Lion Company Limited revalued its land and buildings at the start of the year 2020 to $100m ($30 million for the land). The property cost $50 million ($10 million for the land) ten years prior to the revaluation. The total expected useful life of 50 years is unchanged. The company policy is to make an annual transfer of realized amounts to retained earnings, show the effects of the above on the financial statements for the year

Lion Company Limited revalued its land and buildings at the start of the year 2020 to $100m ($30 million for the land). The property cost $50 million ($10 million for the land) ten years prior to the revaluation. The total expected useful life of 50 years is unchanged. The company policy is to make an annual transfer of realized amounts to retained earnings, show the effects of the above on the financial statements for the year

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 8PA: Referring to PA7 where Kenzie Company purchased a 3-D printer for $450,000, consider how the...

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Referring to PA7 where Kenzie Company purchased a 3-D printer for $450,000, consider how the purchase of the printer impacts not only depreciation expense each year but also the assets book value. What amount will be recorded as depreciation expense each year, and what will the book value be at the end of each year after depreciation is recorded?
On 1 January 2021, Tymba plc has a building with a carrying value of £500,000 which was purchased on 31 December 2010. The company use revaluation model to subsequently measure the building. Depreciation is charged based on straight line method over 50 years. The building were revalued on 30 May 2021 and it had a fair value of £650,000. Tymba plc makes an annual transfer between the revaluation reserves and retained earnings in accordance with best practice. What is the amount of annual transfer on 31 December 2021?
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