Wimbles Limited is a company producing garden implements. The following information relates to the company’s plant:
• The plant originally cost C 600 000 when purchased on 1January 20X8.
• Plant is depreciated on the straight-line basis over 5 years to a nil residual value. This has remained unchanged since acquisition.
• The plant was revalued by Mr. Wimble, an independent sworn appraiser and a member of the Institute of Valuers, as follows:
• On 1/3/20X8 to a fair value of C 725 000
• On 1/3/20X9 to a fair value of C 506 000
• The company adopts the revaluation model and accounts for the revaluation on the net replacement value basis. The maximum amount is transferred from the revaluation surplus to retained earnings on an annual basis. The company intends to keep the asset.
• A tax allowance on the plant is granted at 20% per annum on the straight-line basis, apportioned for time.
• There were no indicators of impairment at any stage during the year.
• The applicable tax rate is 30% throughout. There are no permanent or temporary differences other than those evident from the information presented above.
a) Journalese all related transactions for the years ending 28 February 20X8, 20X9 and
b) Prepare the statement of changes in equity for the year ended 28 February 20Y0.
c) Prepare the following notes for the year ended 28 February 20Y0 in accordance with
International Financial Reporting Standards:
• Profit before tax
• Property, plant and equipment
• Deferred taxation