can anybody please explain, how should one calculate the impact of upward revaluation of an asset on DTL?
Lets say there is an asset purchased in 20X0 for 1 000 USD, tax rate 30%
Accounting depreciation is 20% declining balance, tax depr. is linear 10 years.
At the end of 20X2 the asset is revalued (fair value) back to 1 000. What is the impact on DTL (20X2)? I saw this kind of problem in one of the mocks I do, but I accidentaly closed the browser before being able to read through the solution I only had the chance to glance on it and it was sadly not as simple as “carrying value less tax base times tax rate”.
Thanks for your help