Bed and Breakfast (B&B), an Italian company operating in the Tuscany region, follows IFRS and has made

Question:

Bed and Breakfast (B&B), an Italian company operating in the Tuscany region, follows IFRS and has made the choice to remeasure long-lived assets at fair value. B&B purchased land in 2013 for E150,000. At December 31 of the next four years, the land is worth E160,000 in 2013, E155,000 in 2014, E140,000 in 2015, and E145,000 in 2016.
REQUIRED
a. Describe how B&B will reflect the changes in the land's value in each of its annual financial statements.
b. Assume that the asset was a building with a ten-year remaining useful life as of the end of 2013. After writing the building upward to E160,000, how much should B&B charge to depreciation expense in 2013?