Advance Energy Bhd (AEB) acquired a piece of land and a building on 1 January 2017 at the cost of RM6,000,000 and RM8,000,000 respectively. AEB decided that the acquisition of land is for long term capital appreciation. As for the building, it was planned to be rented out to its wholly subsidiary, Imperial Bhd. The fair value of land and building on 31 December 2017 was RM9,000,000 and RM6,000,000respectively.

On 31 August 2018, due to insufficient working space, AEB decided to terminate the rental agreement with its subsidiary and used the building for administrative use. The building was expected to have a remaining useful life of 10 years. The fair value of the building on 31 August 2018 was RM14,000,000. Unfortunately, due to liquidity issues, AEB sold both land and building on 30 April 2019 for RM15,500,000 and RM12,500,000 respectively. AEB adopted a fair value model for investment property and revaluation model for owner-occupied property. AEB depreciates its non-current assets using the straight-line method and closes its account on 31 December eachyear.

(a)Prepare the journal entries for Advance Energy Bhd for its transaction in the year 2017 and 2018.

(b)Prepare the journal entries for Advance Energy Bhd when it sold both properties in the year2019.

(c)In accordance with MFRS 140 Investment Property, discuss how Advance Energy Bhd consider the accounting treatment for the building that be rented out to ImperialBhd.

(d)After the initial recognition, MFRS 140 Investment Property requires an entity to choose either the cost model or fair value model as its accounting policy. Briefly explain TWO (2) differences between these twomodels.