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Prepare journal entries to record the transactions for Zeta for the year to 30 November 2020 with regards to land and building. Zeta Bio Tech
Prepare journal entries to record the transactions for Zeta for the year to 30 November 2020 with regards to land and building.
Zeta Bio Tech Ltd (Zeta) is engaged in manufacturing of biotechnology products with the below non-current assets as at 30 November 2019: Land and buildings Plant and equipment $'ooo $'ooo Cost/revalued amount 36,000 14,000 Accumulated depreciation (550) (7,140) Carrying amount 35.450 6,860 Zeta's depreciation policy is 50 years straight-line with no residual value for building and warehouse and 30% reducing balance for plant and equipment. It adopts revaluation model for land and buildings and warehouse; and cost model for plant and equipment in accordance with HKAS 16 'Property, Plant and Equipment. Zeta opts for transfer from revaluation reserves to retained earnings only upon derecognition. It is also Zeta's policy to revalue the land and buildings on every two years' basis. The end of its reporting period is 30 November. During the year ended 30 November 2020, Zeta has the following movement on non- current assets. (1) The carrying amount of land and buildings should be revalued on 30 November 2020 to $35 million (including $16 million in respect of the land). The land and buildings as at 1 December 2019 were all purchased on 1 December 2008 and were last revalued on 30 November 2018 to $36 million (including $14 million in respect of the land). Up to 1 December 2019, accumulated revaluation deficit for land is $1.5 million and accumulated revaluation surplus for buildings is $2 million. No land or buildings were disposed of during the year ended 30 November 2020
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