Pillow Limited was in the process of constructing a building when, due to financial difficulties,

it could not complete the construction thereof.

It has the following options:

1. Sell the building as is, (Pillow Limited does, on occasion, sell buildings);

2. Hold the building as is for capital appreciation; or

3. Borrow from the bank and complete the building, then lease this building out to a tenant.

Required:

Explain how Pillow Limited should account for the building under the three options above