ABC Ltd acquired a property on 1 January 2004 at a cost of 4 GH200,000 and...

  

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ABC Ltd acquired a property on 1 January 2004 at a cost of 4 GH200,000 and immediately occupied it as office premise. On acquisition, it was estimated to have a useful life of 50 years. Subsequent to its acquisition, the asset was measured at depreciated cost until 1 October 2009 when management of ABC decided to convert the building into an investment property (mainly for rentals). Following this decision, the property was fair valued at GH#380,000. ABC adopted the fair value model for subsequent measurement of the investment property. At 31 December 2009, it was fair valued at GH 390,000. Required: In accordance with IAS 40: Investment Property, account for the treatment of this property in (5 marks) the 2009 financial statements of ABC Ltd. ABC Ltd acquired a property on 1 January 2004 at a cost of 4 GH200,000 and immediately occupied it as office premise. On acquisition, it was estimated to have a useful life of 50 years. Subsequent to its acquisition, the asset was measured at depreciated cost until 1 October 2009 when management of ABC decided to convert the building into an investment property (mainly for rentals). Following this decision, the property was fair valued at GH#380,000. ABC adopted the fair value model for subsequent measurement of the investment property. At 31 December 2009, it was fair valued at GH 390,000. Required: In accordance with IAS 40: Investment Property, account for the treatment of this property in (5 marks) the 2009 financial statements of ABC Ltd.

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ABC Ltd acquired a property on 1 January 2004 at a cost of 4 GH200000 and immediat... View the full answer