Laos Inc. owns equipment that it purchased on January 1, 2021, for $ 4 million.

The following additional information is available:

Dec. 31, 2021 Book value (after recording 2021 depreciation): $ 3,600,000

Dec. 31, 2021 Fair value: $ 4,100,000

The company uses the revaluation model (asset adjustment method) to account for its property, plant, and equipment.

1) Briefly Explain how the revaluation model for property plant and equipment is different to the cost model.

2) Using the revaluation model, prepare the entries to adjust the assets carrying amount to fair value.