The equity categories for Swire Pacific Limited are illustrated in Exhibit 13-9, on page 790. Using the information in the exhibit, answer the following questions:
1. Recall that the primary purpose of defining different reserve categories is to distinguish between distributable and non-distributable equity. As of December 31, 2004, how much of Swire Pacific’s equity is distributable?
2. What is the U.S. equivalent of Swire Pacific’s revenue reserve?
3. What do you think is the purpose of the capital redemption reserve?
4. As of December 31, 2004, Swire Pacific has a property valuation reserve of HK$34,680 million. Assume that this reserve is recognized as part of one big revaluation—what journal entry would be made? The property valuation reserve is not distributable—why not?
5. What happened to property values related to Swire’s holdings during 2004?

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