Are these journals correct for IAS16 PPE? I don't know if I am understanding how to do it correctly.
Example:
Year 1: Purchase at 1,000,000.00
Year 2: Revaluate to 2,000,000.00
Year 3: Revaluate to 200,000.00
Depreciation = useful life is 5 years
This is how far I got but I don't know if it is correct:
Year 1:
DT Asset @ cost 1,000,000.00 (BS)
CR Bank 1,000,000.00 (BS)
DT Depreciation 200,000.00 (IS) (1,000,000.00 / 5)
CR Accumulated depreciation 200,000.00 (BS)
Year 2:
DT Asset @ cost 1,000,000.00 (BS)
CR Revaluation surplus 1,000,000.00 (BS)
DT Accumulated depreciation 200,000.00 (BS)
CR Revaluation surplus 200,000.00 (BS)
DT Depreciation 500,000.00 (IS) (2,000,000.00 / 4)
CR Accumulated depreciation 500,000.00 (BS)
Year 3:
DT Revaluation surplus 1,200,000.00 (BS)
DT Accumulated depreciation 500,000.00 (BS)
DT Impairment expense 100,000.00 (IS)
CR Asset @ cost 1,800,000.00 (BS)
DT Depreciation 66,666.67 (IS) (200,000.00 / 3)
CR Accumulated depreciation 66,666.67 (BS)
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