I’m sorry for asking the entire question. It was because I don’t understand most of the question/answer and it doesn’t really show how it works from the materials from BPP.
from the answer paper, it says “change in accounting policy” on retained earnings is $40,000 and on revaluation surplus, ($40,000). I don’t know where $40,000 is from and why the amount that was added on retained earnings($40,000) is taken away from revaluation surplus.
and the same thing happens for “transfer to retained earnings” on retained earnings and revaluation surplus. the amount($35000)is added on retained earnings and the same amount is subtracted on revaluation surplus. Why is that?
thank you in advance, happy new year
