Exam 21: Non-Current Assets: Revaluation, Disposal and Other Aspects

Billy's Computer Shop purchased some new equipment trading in old equipment with a carrying amount of $10 000. Cash of $9000 was paid to the supplier and a trade-in allowance of $7000 was granted. The new equipment should be recorded at:

Which of these does not contribute to the value of purchased goodwill?

According to IAS 38/AASB 138 intangible assets that have been established to have finite useful lives:

How many of these statements are true of the composite rate depreciation approach? The general asset mix of a functional group of assets is assumed to be the same through new assets are added and old assets are sold. Additions and retirements are assumed to occur uniformly throughout the year. The method is often used by business entities with many similar assets in one class. Profits and losses on disposal of assets are debited/credited to the accumulated depreciation account so no losses or profits on disposal are recorded.

Which is the true statement?

Which statement relating to the composite-rate depreciation approach is not true?

FK Ltd's fleet of delivery trucks (original cost $850 000) had a carrying amount on 1 July 2012 of $470 000. On that date their value was revised to $500 000. Future depreciation charges will be based on which amount?

Which of these are not examples of biological assets?

On 31 December 2014 an aeroplane with a cost of $200 000 has had accumulated depreciation written off of $170 000. If it was sold for a profit of $30 000 on 1 January 2015 how much was recorded as income from the proceeds of the sale?

On 1 January 2015 the equipment was sold for $15 000. The accounting entry to record the closing of the equipment and the accumulated depreciation of equipment accounts is which of the following?

When a non-current asset is sold the gain or loss on disposal is the difference between:

Which statement concerning patents is true?

Under IAS 38/AASB 138, which statement concerning internally generated intangible assets is not true?

Under the accounting standard dealing with revaluations, IAS 16/AASB 116, an entity is required to:

Carrying amount of equipment is what type of account?

Which statement about goodwill is true?

On 1 January 2015, based on a valuer's estimate of fair value, it was decided to revalue the plant to $65 000. The plant was then assessed to have a further useful life of 5 years and an expected residual amount of $5000. What is the journal entry in the books of Brown Ltd to record depreciation on plant on a straight-line basis for the half-year ending 30 June 2015 (balance date)?

On 31 December 2013 a printing machine with a cost of $380 000 has accumulated depreciation written off of $140 000. If it is sold for $220 000 on 1 January 2014 what will be the net effect of the sale on the income statement?

Under IAS 41/AASB 141 the basis for measuring biological assets is:

How many of these are requirements of IAS 16/AASB 116? An entire class of non-current assets must be revalued together. If the revaluation model is adopted non-current assets should be revalued to either fair value or the value in use. Before a depreciable asset is revalued accumulated depreciation should be written back to the asset account.