IAS 16 prescribes that,if assets within the same class are revalued and some assets increased in value while others decreased in value:
A)the net decrement for the class of asset should be recognised as loss in the income statement.
B)the net increment for the class of asset should be credited to revaluation reserve.
C)the total increment for all assets in the same class that increased in value should be credited to revaluation reserve and total decrement for all assets in the same class of asset should be recognised as loss in the income statement.
D)All of the given answers are correct.

Question

Quizplus · Accepted Answer

IAS 16 requires that increases and decreases in value of assets within the same class should be dealt with separately. Therefore, the incremental revaluation gain for assets that increased in value should be credited to revaluation reserve, while the decremental revaluation loss for assets that decreased in value should be recognized as a loss in the income statement. The net result of these two adjustments should be reflected in the balance sheet as the net increment or decrement for that class of assets.

IAS 16 Prescribes That,if Assets Within the Same Class Are