Sarya AlAqaba is a construction company. The company started a new Giant Villas' Project began on 1 April 2019. The following construction costs were incurred on the project in ($ 000):

 

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Land 5,400 Engineer fees 260 Site groundwork 1, 560 Raw Materials 8,700 Direct labour costs 121 00 Lawful fees 4, 200 Common overheads 490 The project was completed on 1 January 2020 and brought into use following its grand opening on the 1 April 2020 The Company issued a $25m unsecured loan on 1 April 2019 to aid construction of the new project (which meets the definition of a qualifying asset). The loan carried an interest rate of 8% per annum and is repayable on 1 April 2024. Required 1. According to IAS 16 PPE and the retated standards calculate the amount to be recognised and capitalised as property, plant and equipment in respect of the new Villa's project and state what impact the above information would have on the statement of profit or loss (If any) for the year ended 31 March 2020. 2 Assume that on 1 April 2023 the company revalued the Villa to Its current fair value which is cost of construction plus 25%. What is the double entry to record the revaluation according to IAS 167 3. Assume that on 1 April 2023 the company revalued the Villa to its current fair value which is cost of construction minus 25%. What is the double entry to record the revaluation according to IAS 167 4 pitferentiate between depreciation, revaluation and impairments of PPE in terms of Recognition, Measurements and Disclosure. Land 5,400 Engineer fees 260 Site groundwork 1, 560 Raw Materials 8,700 Direct labour costs 121 00 Lawful fees 4, 200 Common overheads 490 The project was completed on 1 January 2020 and brought into use following its grand opening on the 1 April 2020 The Company issued a $25m unsecured loan on 1 April 2019 to aid construction of the new project (which meets the definition of a qualifying asset). The loan carried an interest rate of 8% per annum and is repayable on 1 April 2024. Required 1. According to IAS 16 PPE and the retated standards calculate the amount to be recognised and capitalised as property, plant and equipment in respect of the new Villa's project and state what impact the above information would have on the statement of profit or loss (If any) for the year ended 31 March 2020. 2 Assume that on 1 April 2023 the company revalued the Villa to Its current fair value which is cost of construction plus 25%. What is the double entry to record the revaluation according to IAS 167 3. Assume that on 1 April 2023 the company revalued the Villa to its current fair value which is cost of construction minus 25%. What is the double entry to record the revaluation according to IAS 167 4 pitferentiate between depreciation, revaluation and impairments of PPE in terms of Recognition, Measurements and Disclosure.

Answer rating: 100% (QA)

1 Statement of capitalization of the construction asset Amount 000 Land 5400 Engineerin... View the full answer