61. Under IFRS, when a company chooses to value capital assets at market value, which of the following statements is true?
A. At least three licensed appraisers must agree on a market price.
B. The unrealized gain recorded when the asset is written up allows the company to show stronger net income in that year.
C. The company is required to value all similar assets in the same way.
D. The carrying value of the asset remains the same, but the accumulated depreciation is eliminated.
62. The Fair value of accounting for Property, Plant, and Equipment assets:
A. should be applied to investment property only.
B. should be applied to other Property, Plant, & Equipment assets only.
C. can be applied to all classes of Property, Plant, & Equipment including investment property.
D. is not appropriate under current Canadian GAAP.
63. The revaluation model of accounting for Property, Plant, &Equipment assets:
A. may be applied to all classes of PP&E including investment property.
B. uses a revaluation surplus account to hold net increases in the asset's fair value.
C. should not be applied to investment property.
D. should only be applied to investment property.
64. MacIntosh Inc. has decided to record their property plant and equipment at fair value. Prior to making the adjustment, the capital asset account had a debit balance of $3,220,000 and the related accumulated depreciation was $1,440,000. An independent appraisal has determined a fair value of $6.3 million. Using the proportional method, at what amount would the assets be recorded on the balance sheet immediately after the adjustment to fair value?
A. $1,780,000
B. $6,300,000
C. $3,220,000
D. $3,482,609
65. MacIntosh Inc. has decided to record their property plant and equipment at fair value. Prior to making the adjustment, the capital asset account had a debit balance of $3,220,000 and the related accumulated depreciation was $1,440,000. An independent appraisal has determined a fair value of $6.3 million. Using the proportional method, what would be the amount of accumulated depreciation immediately after the adjustment to fair value?
A. $2,835,000
B. $5,154,545
C. $0
D. $1,440,000
Gross carrying value = X - .45x = $6,300,000 = $11,454545.5- $6,300,000
66. MacIntosh Inc. has decided to record their property plant and equipment at fair value. Prior to making the adjustment, the capital asset account had a debit balance of $3,200,000 and the related accumulated depreciation was $1,440,000. An independent appraisal has determined a fair value of $6.3 million. Using the proportional method, what would be the gross carrying amount of the assets immediately after the adjustment to fair value?
A. $2,817,391
B. $6,300,000
C. $0
D. $11,454,545
Gross carrying value = X - .45x = $6,300,000 = $11,454545
67. Under the revaluation model, when as asset is written down to fair value, which of the following statements is incorrect?
A. Property plant and equipment can be valued at market value if market value can be measured reliably.
B. The loss recorded when a capital asset is written down flows through other comprehensive income, so that net income is not affected.
C. The company is required to value all similar assets in the same way.
D. Under IFRS, a write down reduces the carrying amount of the capital asset and the loss is charged to net income.
68. Financial statement disclosure for capital assets includes all of the following except:
A. the measurement basis for determining the carrying amount.
B. depreciation method and useful lives for each major category of capital assets.
C. depreciation expense.
D. the value-in-use for the next five years for each major category of capital assets.
69. When analyzing the capital assets note in a company's Notes to the Financial Statements, all of the following would be relevant except:
A. a reconciliation of the change in capital assets with the cash flows for investing activities.
B. the basis for and the estimated useful lives for depreciating each major class of capital assets.
C. a description of any impairment of capital assets and how it is determined.
D. an explanation of any goodwill and where it came from.
70. A general description of the depreciation methods applicable to major classes of depreciable assets:
A. is not a current practice in financial reporting.
B. is not essential to a fair presentation of financial position.
C. is needed in financial reporting when company policy differs from income tax policy.
D. should be included in corporate financial statements or notes to the financial statements.