1) Amihan constructs a 3-storey building of which it currently rents out 1 floor and occupies the other 2 floors. The floors could not be sold separately. 2) Amihan bought several properties in Encantadia, which it rents out. However, one of the buildings is located in a poor and neglected area of a small town and finding tenants is difficult. The building had been vacant for over a year now. 3) Amihan bought three properties in Singapore that it intends to rent out in the future. At the date of acquisition there was no active market in the relevant locations. According to management it is therefore not possible to measure the fair value of the properties reliably. Amihan has the following questions to you, its auditor, in relation to its financial statements for the year ending December 31, 2020: 1. How should the three-storey building be accounted for? a. Property and equipment b. Investment property c. 1 floor as investment property and 2 floors as property and equipment d. 1 floor as investment and 2 floors as property and equipment

Answer rating: 100% (QA)

As Amihans auditor I would provide the following response How should the threestorey building be acc... View the full answer