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Zorluk: OrtaRevaluation of Assets and Liabilities

Match each partnership revaluation transaction on the left with its corresponding double-entry accounting rule on the right.

  • An increase in the Provision for Doubtful Debts upon revaluationDebit Revaluation Account and Credit Provision for Doubtful Debts Account
  • A reduction in Sundry Creditors liabilities upon revaluationCredit Revaluation Account and Debit Sundry Creditors Account
  • An appreciation in the value of Plant and MachineryCredit Revaluation Account and Debit Plant and Machinery Account
  • An unrecorded liability for accrued wages brought into the booksDebit Revaluation Account and Credit Accrued Wages Account

Cevap

1. Increase in Provision for Doubtful Debts → Debit Revaluation Account and Credit Provision for Doubtful Debts Account; 2. Reduction in Sundry Creditors → Credit Revaluation Account and Debit Sundry Creditors Account; 3. Appreciation in Plant and Machinery → Credit Revaluation Account and Debit Plant and Machinery Account; 4. Unrecorded Accrued Wages → Debit Revaluation Account and Credit Accrued Wages Account.
Each revaluation adjustment follows basic nominal account rules: gains (asset appreciation, liability reduction) are credited to the Revaluation Account, while losses (increased provisions, unrecorded liabilities) are debited to the Revaluation Account.

Adım Adım Çözüm

1
Identify the nature (gain or loss) of each revaluation item
Asset appreciations and liability reductions are gains. Asset depreciations, provision increases, and unrecorded liabilities are losses.
Revaluation gains increase capital while revaluation losses decrease capital.
2
Apply double-entry rules for revaluation gains
Debit the specific asset/liability account and Credit the Revaluation Account.
The Revaluation Account acts as a nominal account where all gains are credited.
3
Apply double-entry rules for revaluation losses
Debit the Revaluation Account and Credit the specific asset/liability account.
Nominal accounts are debited with all losses and expenses.

Anahtar Kavram

Double-entry rules for posting asset and liability revaluation adjustments to the Revaluation Account.
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