6.16. An asset having a cost of $100,000 and accumulated depreciation of $20,000 is revalued to $120,000 at the beginning of the year. Depreciation for the year is based on the revalued amount and the remaining useful life of eight years. Shareholders' equity, before adjusting for the above revaluation and subsequent depreciation, is as follows: Share capital Revaluation surplus Capital profits reserve Retained earnings $ 300,000 45,000 85,000 70,000 500.000 REQUIRED Prepare journal entries to reflect the revaluation of the asset and the subsequent depreciation of the revalued asset. Which of the equity accounts would be affected directly or indirectly by the revaluation
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