ABC company purchases a piece of land for £150,000 on 1st March 2012 and records it using the cost model. It has an expected useful life of 10 years. At the end of 3 ^rd accounting year, the company decides to follow the revaluation model. At that date, the value of the asset is estimated to be £140,000. At the end of the 4 ^th year, there is a fall in the market value of the property and the value is estimated to be £89,000. On 15 ^th  May 2016 the asset is finally disposed off at a market value that is 10% lower than the then NBV. How will the revaluation and disposal be accounted for in such a scenario? Year-end 31st Dec.  

 

Default policy charging in full depreciation in the year of acquisition and none in the year of disposal.

T-Accounts and Ledger Entries Requires