Use the Following Information to Answer This Question

question 20

Multiple Choice

Use the following information to answer this question.
An extract of a company's draft statement of financial position at 30 June 2012 discloses the following:
Plant (at cost) $500 000
Less accumulated depreciation 300 000 $200 000
On 30 June 2013 the company assessed the fair value of the plant to be $350 000. At 30 June 2014, the carrying amount of the plant was $250 000.
The tax rate is 30%. Depreciation rates are 10% p.a. (accounting) and 12.5% p.a. (tax) using the straight-line method.
The journal entries to adjust for the tax effect of the revaluation at 30 June 2013 is:

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Definitions:

Equilibrium World Price

The price at which the quantity of a good supplied globally equals the quantity demanded, in international trade.

Domestic Quantity Supplied

The total amount of a product that producers in a country are willing and able to sell at a given price level within a specified period.

Domestic Quantity Demanded

The total amount of a good or service that consumers in a country are willing and able to purchase at a given price level, within a specified period.

Hypothetical Nations

Imaginary countries used in theoretical models or scenarios to illustrate economic principles or theories.