Question 2

The following data from Lyre Ltd's accounts relates to two assets at 30 June 2018:

Asset		Value		Accumulated depreciation		Carrying amount
Land		$2,350,000		0		$2,350,000
Plant and equipment		$180,000		$36,000		$144,000

At 30 June 2018 Lyre Ltd decides to adopt the revaluation model for both these assets. On this date land has a fair value of $2,230,000 and plant and equipment has a fair value of $177,000. On 30 June 2019 Lyre Ltd reviews the value of its assets. The fair value of land is reassessed as $2,278,000. Plant and equipment has no change in value on that date. Prepare the journal entries required to revalue the assets for the year ended 30 June 2018 and the 30 June 2019. (Enter debit entries first followed by credit entries. Credit account titles are automatically indented when the amount is entered. Do not indent manually.)

Lyre Ltd Journal entries for the year ended 30 June 2018
Account and explanation	Debit	Credit
Gain on revaluation of land (P/L) Plant and equipment Asset revaluation surplus Gain on revaluation of plant and equipment (OCI) Accumulated depreciation plant and equipment Loss on revaluation of land (P/L) Land
Gain on revaluation of plant and equipment (OCI) Land Loss on revaluation of land (P/L) Accumulated depreciation plant and equipment Plant and equipment Asset revaluation surplus Gain on revaluation of land (P/L)
(Downward revaluation of land from carrying amount to fair value)
Plant and equipment Loss on revaluation of land (P/L) Accumulated depreciation plant and equipment Gain on revaluation of land (P/L) Asset revaluation surplus Land Gain on revaluation of plant and equipment (OCI)
Gain on revaluation of land (P/L) Land Accumulated depreciation plant and equipment Plant and equipment Gain on revaluation of plant and equipment (OCI) Loss on revaluation of land (P/L) Asset revaluation surplus
(Write down of plant and equipment to its carrying amount)
Accumulated depreciation plant and equipment Land Gain on revaluation of plant and equipment (OCI) Plant and equipment Asset revaluation surplus Gain on revaluation of land (P/L) Loss on revaluation of land (P/L)
Loss on revaluation of land (P/L) Plant and equipment Gain on revaluation of land (P/L) Gain on revaluation of plant and equipment (OCI) Asset revaluation surplus Land Accumulated depreciation plant and equipment
(Revaluation of plant and equipment to fair value)
Loss on revaluation of land (P/L) Land Accumulated depreciation plant and equipment Plant and equipment Gain on revaluation of plant and equipment (OCI) Asset revaluation surplus Gain on revaluation of land (P/L)
Loss on revaluation of land (P/L) Gain on revaluation of plant and equipment (OCI) Land Accumulated depreciation plant and equipment Asset revaluation surplus Plant and equipment Gain on revaluation of land (P/L)
(Accumulation of net revaluation gain in equity)

Lyre Ltd Journal entries for the year ended 30 June 2019
Account and explanation	Debit	Credit
Loss on revaluation of land (P/L) Gain on revaluation of land (P/L) Gain on revaluation of plant and equipment (OCI) Asset revaluation surplus Accumulated depreciation plant and equipment Land Plant and equipment
Land Gain on revaluation of plant and equipment (OCI) Accumulated depreciation plant and equipment Asset revaluation surplus Gain on revaluation of land (P/L) Plant and equipment Loss on revaluation of land (P/L)
(Revaluation of land from carrying amount to fair value subsequent to prior write down of the land)