IAS 16 Accounting Entries

Question 1

At initial recognition?

Answer 1

Debit: PPE (Property, Plant, and Equipment) Account
Credit: Accounts Payable, Cash, or another relevant account

Question 2

At depreciation?

Answer 2

Debit: Depreciation Expense
Credit: Accumulated Depreciation (contra asset account)

Question 3

At revaluation upwards?

Answer 3

Debit: PPE (for the increase in value, if any)
Credit: Accumulated Depreciation (to eliminate any previous accumulated depreciation)
Credit: Revaluation Surplus (in equity)

Question 4

At disposal?

Answer 4

Debit: Accumulated Depreciation
Debit: Revaluation Surplus (if any)
Credit: Asset (to remove it from the books)

Question 5

At further revaluation?

Answer 5

Debit: Asset (to adjust its carrying amount)
Credit: Revaluation Surplus

Question 6

How is revaluation recorded?

Answer 6

In equity

Question 7

How is revaluation decrease recorded?

Answer 7

Debit: Asset (to adjust its carrying amount)
Credit: Revaluation Surplus