A Company Recently Replaced a Significant Part of Equipment Carried

question 20

Multiple Choice

A company recently replaced a significant part of equipment carried at cost.Which action would be consistent with AASB 116?

• A) include cost of replacement part in the asset's carrying amount without regard for the carrying amount of the part replaced
• B) revalue the carrying amount of equipment before recognising the replacement part purchased
• C) derecognise the carrying amount of the part replaced and include cost of replacement part in the asset's carrying amount
• D) recognise the cost of replacement part as expense as the cost is a material amount

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Definitions:

Impact Craters

Circular depressions formed by the collision of a meteorite, asteroid, or comet with the Earth's surface, characterized by a raised rim and, in some cases, a central peak.

Topographic Relief Map

A map that shows the elevation and gradient of the Earth's surface with contour lines or shading to represent the terrain.

Radar Data

Information collected using radar systems, which emit radio waves and receive signals bounced back from objects, used in various applications including weather forecasting, aircraft navigation, and geological observations.

Lunar Highlands

The lighter and heavily cratered areas of the Moon, which are elevated regions rich in anorthosite.