Test 2 solution

Answer-1

Tsuki Limited
Notes to the financial statements
For the year ended 31. Dec.21 31-Dec-21 31-Dec-20
Office Office
12. Property, Plant and Equipment Warehouse Warehouse
building building
Gross Carrying Amount
Opening balance 116.0 138.0 116.0 138.0
Transfer (20.0) (21.0) - -
Revaluation (16.0) 26.0 - -
Closing balance 80.0 143.0 116.0 138.0
Accumulated Depreciation
Opening balance 20.0 21.0 8.0 12.0
Transfer (20.0) (21.0) - -
Depreciation 10.0 11.0 12.0 9.0
Closing balance (10.0) (11.0) (20.0) (21.0)
Book value 70.0 132.0 96.0 117.0
12.1
Measurement Basic Revaluation Revaluation Revaluation Revaluation
Straight
Depreciation method Straight line Straight line Straight line
line
Life / rate 8 years 13 years 9 years 14 years
12.2
Last revaluation was performed on 1 January 2021 by sagheer valuation services, an in dependent firm of valuers.
12.3
Had revaluation not been made, the carrying value of the buildings and warehouse as on 31 December 2021 would
have been Rs 63 million and 117 million respectively.

W-1: Carrying value on cost basis Building Warehouse

Book value on 1 January 2020 81 136.5
(96*13.5/16) (156*10.5/12)
Book value on 31 December 2021 63 117
(81*7/9) (136.5*12/14)

(W-1)
Date Description Office building R/S P/L
01.07.17 Cost 96.0
31.12.17 Depreciation (96/16) x 6/12 (3.0)
31.12.17 BV 93.0
31.12.18 Depreciation (96/16) (6.0)
31.12.18 BV 87.0
01.01.19 Revaluation surplus (Bal.) 29.0 29.0
01.01.19 Revalued amount 116.0 29.0
31.12.19 Depreciation (116/14.5) : (29/14.5) (8.0) (2.0)
31.12.19 BV 108.0 27.0
31.12.20 Depreciation (108/9) : (27/9) (12.0) (3.0)
31.12.20 BV 96.0 24.0
01.01.21 Revaluation loss (Bal.) (16.0) (16.0)
01.01.21 Revalued amount 80.0 8.0
31.12.21 Depreciation (80/8) : (8/8) (10.0) (1.0)
31.12.21 BV 70.0 7.0

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 Test 2 solution

(W-1)
Date Description Warehouse R/S P/L
01.07.18 Cost 156.0
31.12.18 Depreciation (156/12) x 6/12 (6.5)
31.12.18 BV 149.5
01.01.19 Revaluation surplus (Bal.) (11.5) (11.5)
01.01.19 Revalued amount 138.0 (11.5)
31.12.19 Depreciation (138/11.5): (11.5/11.5) (12.0) 1.0
31.12.19 BV 126.0 (10.5)
31.12.20 Depreciation (126/14): (10.5/14) (9.0) 0.8
31.12.20 BV 117.0 (9.8)
01.01.21 Revaluation surplus (Bal.) 26.0 16.3 9.8
01.01.21 Revalued amount 143.0 16.3 -
31.12.21 Depreciation (143/13): (16.3/13) (11.0) (1.3)
31.12.21 BV 132.0 15.0

Answer-2

1. Option (d) 11.8

2. Option (b) 13333

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