A company acquired a new piece of equipment on January 1, 2011 at a cost of $200,000. The equipment is expected to have a useful life of 10 years, a residual value of $20,000 and is depreciated on a straight-line basis. On January 1, 2013, the equipment was appraised and determined to have a fair value of $190,000 and a residual value of $25,000 and a remaining useful life of 10 years.
At what amount should the equipment be reported on the December 31, 2013 balance sheet under the IFRS revaluation model?

Question

Quizplus · Accepted Answer

FV $190,000 - Salvage $25,000 = $165,000/10 years = $16,500 Depreciation per yearFV $190,000 - Revised Depreciation Expense $16,500 = $173,500 BV 12/31/2013 under IFRS Revaluation Model

A Company Acquired a New Piece of Equipment on January