13. FL Inc. had its head office on 30 June 20xs, a building nearby, which it was
ID: 2520746 • Letter: 1
Question
13. FL Inc. had its head office on 30 June 20xs, a building nearby, which it was renting to Unfortunate Limited, was destroyed. As Unfortunate Limited was a valued customer, FL decided to lease 80% of the head office to them as a 'replacement' .The head office was purchased on the 1 January 20X5 for $600 000 (total useful life: 10 years) On the 30 June 20X5, the fair value of the head office was C800 000. There was no change in fair value at 31 December 20X5 FL uses: the fair value model to measure its Investment Property: and the cost model to measure its property, plant and equipment. located in De Rust, South Africa. During a freak' landslide Required: Provide the journal entries in the books of FL for the year ended 31 December 20X5.Explanation / Answer
DATE
DETAILS
DR $
CR $
1/1/X5
BUILDING
600,000
CASH
600,000
30/6/X5
DEPRECIATION BUILDING
30000
ACC DEP BUIDLING
30000
( BEING COST MODEL BEING USED FOR BUILDING )
DR RAND
CR RAND
1/7/20X5
INVESTMENT PROPERTY
80000
BUILDING
800000
31/12/20X5
UNFORTUNATE PLC
40000
LEASE RENTAL INCOME
40000
DATE
DETAILS
DR $
CR $
1/1/X5
BUILDING
600,000
CASH
600,000
30/6/X5
DEPRECIATION BUILDING
30000
ACC DEP BUIDLING
30000
( BEING COST MODEL BEING USED FOR BUILDING )
DR RAND
CR RAND
1/7/20X5
INVESTMENT PROPERTY
80000
BUILDING
800000
31/12/20X5
UNFORTUNATE PLC
40000
LEASE RENTAL INCOME
40000
Related Questions
Hire Me For All Your Tutoring Needs
Integrity-first tutoring: clear explanations, guidance, and feedback.
Drop an Email at
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.