Questions 7 Through 10 Are Based on the Following Information

question 11

Multiple Choice

Questions 7 through 10 are based on the following information:
Tongas Company applies revaluation accounting to plant assets with a carrying value of $1,600,000, a useful life of 4 years, and no salvage value. Depreciation is calculated on the straight-line basis. At the end of year 1, independent appraisers determine that the asset has a fair value of $1,500,000.
-The journal entry to adjust the plant assets to fair value and record revaluation surplus in year one will include a

• A) debit to Accumulated Depreciation for $100,000.
• B) credit to Depreciation Expense for $300,000.
• C) credit to Plant Assets for $300,000.
• D) credit to Revaluation Surplus for $300,000.

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Definitions:

Receiving Report

A document that records the details of materials or goods received by a company, ensuring the quantities and descriptions match the order.

Materials Ordered

The process of requesting and purchasing raw materials or supplies required for production or operations.

Materials Requisitions

Documents that request the release of materials to be used in the production process or for other operational needs.

Recording Materials

The process of documenting raw materials, work-in-progress, and finished goods within a business.