Question Description
WNO Food Bhd purchased 2 industrial buildings in Pending area on 1 January 2015. Building A is used as a place to process food which is a product of the company while Building B is vacant and rented out to X1 Techno Sdn Bhd. Each building costs RM485,200 and the total legal fees for both buildings amounting RM25,000.
The company paid cash for the costs and legal fees on 1 January 2015. The estimated useful life of the buildings were 25 years. Each building was revalued on 1 January 2020; the fair value of building A was RM505,000 and building B was RM510,000. WNO Food Bhd adopted revaluation model for property, plant and equipment and fair value model for its investment property.
Required:
- Journalized the transaction related to Building A for the year ended 2020. (show all relevant workings and MFRS)
