Revaluation reserve

 As per Accountant standard and Guidance Note Issued by IcaiWhen the Revalued fixed  asset is sold in future , the profit on sale  is transfered to profit and loss account. when loss on sale is transfered to Revaluation reserve account and unadjusted revaluation reserve is transfered to General reserve.

a. What is the logic is there in Transfered the revaluation reseve to general reserve

b. if transfered  whether it is considered as free reserve and  used for Dividend payout or payment of managerial remuneration.

Replies (3)
Revaluation reserve is created against a particular asset since the asset has been dispose off so there is no use of revaluation reserve.
Originally posted by : Celiena goel
Revaluation reserve is created against a particular asset since the asset has been dispose off so there is no use of revaluation reserve.

for answer for (b)

B.) Yes, it can be used for any purpose

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