Presented below are the balances for property plant and equipment for Summer Holdings Inc., a publicly quoted company, as at December 31, 2019. The company accounts for these assets under the cost model, using IAS 16:

Buildings

$900,000

Less: accumulated depreciation

150,000

$750,000

Equipment

$225,000

Less: accumulated depreciation

100,000

125,000

The company has decided to adopt the revaluation model for its building and equipment effective January 1, 2020. An independent appraiser has assessed the fair value of the building at $780,000 and equipment at $95,000 on January 1, 2020.

The company uses the straight-line method of depreciation. At January 1, 2020, the remaining useful life on the building is 20 years, and 5 years on the equipment. There is no estimated residual value on either of the assets.

REQUIRED:

Part A (4 marks)

Record the necessary journal entry(ies) to revalue the building and equipment as at January 1, 2020 using the Revaluation Model using the asset adjustment method. (SHOW ALL CALCULATIONS CLEARLY)

Part B (3 marks)

Record the appropriate journal entries for depreciation expense for BOTH assets for the year ended December 31, 2020. (SHOW ALL CALCULATIONS CLEARLY)