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Tunjang Bhd acquired a plant on 1 January 2015 for RM1,200,000. The equipment is expected...

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Accounting

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Tunjang Bhd acquired a plant on 1 January 2015 for RM1,200,000. The equipment is expected to be used for ten years. On 31 December 2016, the fair value of the plant was RM1,320,000 and the remaining life was 8 years. Tunjang Bhd uses a revaluation model to measure the carrying amount of the non-current assets. Annual transfers were made from the revaluation reserve to the retained earnings. Unfortunately, there were indications the assets could be impaired on 31 December 2018. The fair value less cost to disposal was RM720,000 and the value in use was estimated to be RM900,000. Required: Discuss the accounting treatment in 2018 and 2019. (Total: 15 marks)

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