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Thread: Fair Value Adjustment

  1. #1
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    Fair Value Adjustment

    Hi,

    I do know how to process the journal for when property is sold:
    Cr - Fixed Asset
    Dr - Accumulated Depreciation
    Dr - Cash

    How does one the clear the fair asset value adjustment, as it has increased due to the property.

    Thanks,

  2. #2
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    Your entries should be
    Cr. Cost
    Dr. Accumulated Depreciation
    Dr. Impairment / Fair Value (I assume it is a credit?)
    Dr. / Cr. Profit or Loss on disposal with the net of the above, this represents the net carrying value.
    Dr. Cash
    Cr. Profit or Loss on disposal

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    Hi Andromeda,

    Thanks for the replay however Fair Value is a debit. Kindly see below.
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  4. #4
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    Ah ok.

    Your entries would be
    Cr. Cost
    Dr. Accumulated Depreciation
    Cr. Fair Value
    Dr. / Cr. Profit or Loss on disposal with the net of the above, this represents the net carrying value.
    Dr. Cash
    Cr. Profit or Loss on disposal

    Now you need to get rid of the NDR, so credit the NDR and debit Retained Income.

  5. #5
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    Hi Andromeda,

    NDR would be my net disposable revenue?

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