IAS 16 short Revision

Question 1

Steps involved in the Revaluation of PPE?

Answer 1

2 steps.
1st: Elimination of Accumulated Depreciation
Dr: Acc. Dep XXX
Cr: Asset XXX

2nd: Revaluation of asset
(Upward)
Dr: Revaluation Loss (if any) XXX
Dr: Asset XXX
Cr: Revaluation Surplus XXX
(Downward)
Dr: Revaluation Surplus (If any)XXX
Dr: Profit & Loss XXX
Cr: Asset XXX

Question 2

Amount of Revaluation loss in case of reversal(Debit) (upward revaluation)

Answer 2

Amount of Revaluation loss should be all loss charged till date net of undercharged depreciation

Question 3

Time and amount of revaluation surplus to be charged to retained earnings

Answer 3

At the time depreciation is charged in revalued amount- Amount= Incremental Depreciation( Dep charged - Dep @ Cost model)

At the time of derecognition of asset- Whole amount in revaluation surplus account.