Presto's Brazilian Subsidiary, Brazil Co, owns a corporate office in a desirable location in downtown Brasilia. The property was purchased on 1/1/20X1 for the equivalent of $10 million USD and is being depreciated straight-line over a 30-year life. An appraisal on 12/31/X4 indicated that the building is now worth $14 million.

Required:

• Brazil Co is asking whether it can re-measure the property to show this increased value on its statement of financial position and, if so, what the offsetting (credit) entry should be.
• Brazil Co is also asking whether this re-measurement would have any effect on its existing policy to depreciate the building straight-line over 30 years.
• Finally, Presto is wondering whether this increased value is appropriate to carry into its U.S. consolidated financial statements.