Questions 7 through 10 are based on the following information:
Tongas Company applies revaluation accounting to plant assets with a carrying value of $1,600,000, a useful life of 4 years, and no salvage value. Depreciation is calculated on the straight-line basis. At the end of year 1, independent appraisers determine that the asset has a fair value of $1,500,000.
-The financial statements for year one will include the following information
A) Accumulated depreciation $400,000.
B) Depreciation expense $100,000.
C) Plant assets $1,500,000.
D) Revaluation surplus $100,000.
Correct Answer:
Verified
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