QUESTION 5

1. On 1 April 2019 HonDe Bhd carried its office block in its financial statements at its original cost of RM4 million less depreciation of RM800,000 (based on its original life of 50 years). HonDe Bhd revalued the office block on 1 October 2019 to its current value of RM3.9 million. The useful life remaining was reassessed at the time of valuation and is considered to be 40 years at this date. It is the companys policy to charge depreciation proportionally.

   Required:

   Fill in the blanks with the correct option given below.

   Revaluation surplus	RM40,000	RM3,900,000
   Revaluation deficit	RM48,750	RM3,851,250
   Profit or loss	RM80,000	RM3,802,500
   Revaluation reserve	RM88,750	RM3,200,000
   Office block	RM740,000	RM3,160,000
   Accumulated depreciation	RM780,000	RM3,120,000
   Accumulated amortisation	RM700,000	-

   On 1 October 2019, HonDe revalue the office block with a fair value of RM3.9 million at that date. The carrying value of the office block as at 30 September 2019 was______ after provided depreciation to the office block of______ for the period from 1 April 2019 to 30 September 2019. The______ arising on the revaluation on 1 October 2019 was______ . The journal to recognise the changes in the carrying value of the office block as follows:

   Description of Account	DR	CR
   DR (_________)	(__________)	(________)
   CR (_________)	(__________)	(__________)

   Note: HonDe eliminates the accumulated depreciation against the gross carrying value amount of the office block to account for the changes in the carrying value of the office block on 1 October 2019.

   As at 31 March 2020, the carrying value of the office block was _____ . The depreciation charged to the office block for the year ended 31 March 2020 was _____ .