Assume that Pelu Group purchased a piece of land on January 1, 2019, that cost 400,000,...

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Assume that Pelu Group purchased a piece of land on January 1, 2019, that cost 400,000, paid by cash. The following fair value information is available: Date 12/31/2019 12/31/2020 12/31/2021 Fair Value 415,000 380,000 450,000 Assume the cost to sell the land is negligible. Pelu Group sold the land on January 3, 2022, for 450,000. Course Code ACCT3111A Required: =() Page 3 of 4 1) Suppose that Pelu classified the land as PP&E, and adopted the historical cost model. Prepare all journal entries from January 2019 to January 2022. 2) Suppose that Pelu classified the land as PP&E, and adopted the revaluation model. Prepare all journal entries from January 2019 to January 2022. 3) Suppose that Pelu classified the land as investment property, and adopted the fair value model instead. Prepare all journal entries from January 2019 to January 2022. 4) Briefly explain why a company may not adopt the revaluation model for its PP&E. 5) Briefly explain why a company may not adopt the fair value model for its investment property. Assume that Pelu Group purchased a piece of land on January 1, 2019, that cost 400,000, paid by cash. The following fair value information is available: Date 12/31/2019 12/31/2020 12/31/2021 Fair Value 415,000 380,000 450,000 Assume the cost to sell the land is negligible. Pelu Group sold the land on January 3, 2022, for 450,000. Course Code ACCT3111A Required: =() Page 3 of 4 1) Suppose that Pelu classified the land as PP&E, and adopted the historical cost model. Prepare all journal entries from January 2019 to January 2022. 2) Suppose that Pelu classified the land as PP&E, and adopted the revaluation model. Prepare all journal entries from January 2019 to January 2022. 3) Suppose that Pelu classified the land as investment property, and adopted the fair value model instead. Prepare all journal entries from January 2019 to January 2022. 4) Briefly explain why a company may not adopt the revaluation model for its PP&E. 5) Briefly explain why a company may not adopt the fair value model for its investment property.

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1 Journal entries under the historical cost model January 1 2019 Land PPE 400000 Cash 400000 To record the purchase of land January 3 2022 Cash 450000 ... View the full answer