HI6025 Assessment Questions On Accounting Theory And Current Issues

Question 1 ( 7 marks)

ABC Ltd has the following land and buildings in its financial statements as at 30 June 2022:

At 30 June 2022, the balance of the revaluation surplus is $800 000, of which $600 000 relates to the factory land and $200 000 to the buildings. On this same date, independent valuations of the land and buildings are obtained. In relation to the above assets, the assessed fair values at 30 June 2022 are:

Required:

Provide the journal entries to account for the revaluation on 30 June 2022. ABC Ltd classifies the residential land and the factory land as different classes of assets.