Question

A company revalues its PPE upward to reflect fair value. Where should the resulting increase be recorded in financial statements?

Q: Answer-A company revalues its PPE upward to reflect fair value. Where should the resulting increase be reco...

Under IAS 16, an upward revaluation does not represent realized income.Therefore, it is credited to Revaluation Surplus under Equity OCI and bypasses Profit Loss to avoid inflating profits with unrealized gains.

A P&L

B Revenue

C Equity reserve

D Deferred income

E Liability

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A company revalues its PPE upward to reflect fair value. Where should the resulting increase be recorded in financial statements?

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