During the year to 12/31/2020, Willie incurred $500,000 developing and completing a new product that meets the capitalization criteria of IAS 38. The product will be ready for sale on 1/1/2021, and has a life of five years. 2020 net income and retained earnings at 12/31/2020 reported by IFRS would be:

A) Both 2020 net income and 12/31 retained earnings would be $500,000 higher than U.S. GAAP.

B) 2020 Net income would be $100,000 lower and retained earnings at 12/31/2020 would be $200,000 higher than US GAAP.

C) 2020 Net income would be $100,000 higher and retained earnings at 12/31/2020 would be $300,000 higher than US GAAP.

D) 2020 Net income would be $100,000 lower and retained earnings at 112/31/2020 would be $300,000 higher than US GAAP.

During 2018, Willie Ltd incurred $200,000 developing and completing a new product that meets the capitalization criteria of IAS 38. The product went on sale on 1/1/2019 and had a useful economic life of five years. When compared to the figures reported in the US GAAP financial, IFRS net income for the year ended 12/31/2020 and retained earnings at 12/31/2020 reported would be:

A) IFRS net income for 2020 would be $40,000 higher than US GAAP, and retained earnings at 12/31/2020 would also be $40,000 higher.

B) IFRS net income for 2020 would be $40,000 lower than US GAAP, but retained earnings at 12/31/2020 would be $40,000 lower than US GAAP.

C) IFRS net income for 2020 would be $40,000 lower than US GAAP, but retained earnings at 12/31/2020 would be $120,000 higher than US GAAP.

D) IFRS net income for 2020 would be $80,000 lower than that reported by US GAAP, but retained earnings at 12/31/2020 would be $120,000 higher than US GAAP.

Using IAS 16, a revaluation of PPE not held for investment purposes, results in a gain that is:

A) Debited to revaluation reserve

B) Credited to the buildings account

C) Credited to revaluation reserve

D) Credited to net income