Question 9 Which is the true statement? a. A revaluation decrease should occur if a non-current asset's carrying amount is less than its fair value. b. An initial revaluation decrease should be treated as a debit to the revaluation surplus reserve. c. An initial revaluation decrease should be treated as a debit against the current periods profit or loss. d. An initial revaluation decrease should be disclosed in the profit report as a reduction in other comprehensive income. Question 11 The balance sheet of Doorbell Ltd at 31 December 2014 showed: $ Equipment 80 000 Accumulated depreciation of equipment 63 000 17 000 On 1 January 2015 the equipment was sold for $15 000. What is the accounting entry to record the receipt of the proceeds from the sale of the equipment? a. Debit bank $15 000; credit proceeds from sale of equipment $15 000 b. Debit bank $17 000; credit proceeds from sale of equipment $17 000 c. Debit bank $15 000; credit equipment $15 000 d. Debit bank $2000; credit proceeds from sale of equipment $2000 Question 12 If a computer with a fully depreciated cost of $30 000 is discarded as worthless, the accounting entry to record the scrapping is which of the following? a. Debit expense on disposal of asset $30 000; credit computer $30 000 b. Debit expense on disposal of asset $30 000; credit accumulated depreciation computer $30 000 c. Debit accumulated depreciation computer $30 000; credit computer $30 000 d. Debit accumulated depreciation computer $30 000; credit computer $30 000; Debit expense on disposal of asset; credit proceeds of disposal of asset $30 000 Question 13 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? a. $20 000 profit b. $20 000 loss c. $160 000 loss d. $80 000 profit Question 14 Billys 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: a. $19 000. b. $16 000. c. $9000. d. $7000. Question 15 On 31 December 2014 an aeroplane with a cost of $200 000 has accumulated depreciation written off of $90 000. If it was sold for $130 000 on 1 January 2015 how much will be recorded as the expense carrying-value on the disposal of the plane? a. $200 000 b. $130 000 c. $110 000 d. $90 000