Make all required journal entries on revaluation surplus

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Reference no: EM132770453

Bells Inc. owns a motel that it had purchased on January 1, 2020, for $ 1.5 million cash and is accounted for in a separate account, classified as "Structures." The company is using the revaluation model to account for its structures and revalues them every two years. Bells uses straight-line depreciation over the asset's 15-year useful life with no residual value.

The asset's fair value was $ 1,450,000 on Dec. 31, 2021.

Instructions
Using proper descriptions on all accounts:

Problem 1: Make the acquisition for 2020 and depreciation entries for 2020 and 2021

Problem 2: Assuming Bells uses the asset adjustment method for revaluation, make all required journal entries on Revaluation surplus or deficit for 2021.

Problem 3: Record the depreciation entry of Structures for 2022

Reference no: EM132770453

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