Question
At the beginning of the year 2019, UNO Company has an investment property acquired at a cost of 2,000,000. On December 31, 2019, the fair
At the beginning of the year 2019, UNO Company has an investment property acquired at a cost of 2,000,000. On December 31, 2019, the fair value was 2,200,000 and on December 31, 2020, the fair value was 1,950,000. The property had a useful life of 25 years.
1. Under the cost method, what is the expense recognized in the profit or loss for the year ended December 31, 2020?
2. Under the fair value method, what is the expense recognized in the profit or loss for the year ended December 31, 2020?
3. Under the cost method, what is the carrying value of the investment that should be carried in the statement of financial position as of December 31, 2020?
4. Under the fair value method, what is the carrying value of the investment that should be carried in the statement of financial position as of December 31, 2020?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started