1.When an item of PPE is derecognised, the treatment of any revaluation surplus that relates to an asset includes:

A. debiting the revaluation surplus account in the journal entry to record the gain or loss on sale of the asset

B. writing off the amount out of the revaluation surplus against the remaining assets in the class of asset that was sold belonged

C. transferring the relevant amount out of the asset revaluation reserve and showing it as revenue in the income statement

D. transferring the revaluation surplus to share capital

2.Prior to the finalisation of the financial statements for the year ended 30 June 2021, a company experienced a number of material events, including:

IOn 9 July 2021 the directors decided to close a division of the company at an estimated cost of $1 000 000.

IIOn 9 August 2021 a court decision found the company liable to pay damages of

$500 000 to a major customer who had commenced legal action in May 2021.

IIIAn independent valuation of property conducted on 21 July 2021 revealed that the

directors' valuation included in the 30 June 2021 financial statements was overstated by

$700 000.

In respect of the events listed above, it will be necessary to adjust the financial statements, by way of general journal entries, for:

A. III only, and make a note disclosure for I and II

B. II only, and make a note disclosure for I and III

C. II and III only, and make a note disclosure for I

D. I, II and III

3.Baskin Ltd has been negotiating to purchase several properties with a company that is currently its major customer. Subsequent to its reporting date (of 30 June 2021), the agreement is finalised and the fair value of the consideration to be paid by Baskin Ltd will be $5 million. This will materially affect the Company and it will bring substantial economic benefits to its shareholders. How should this event be reported at 30 June 2021 in accordance with AASB 110/IAS 10?

A. It is sufficient to be reflected in the Directors' and Chairman's Report

B. This event should be highlighted in the Directors' report and adjusting entries are required at 30 June 2021

C. A description of the event, the fact that it occurred after the reporting date and its financial effects on the Company should be disclosed by way of a note to the financial statements.This event should be highlighted in the Directors' report

D. Adjusting entries are required at 30 June 2021 and no disclosure is required