Reilly Co., a family-owned company, had a vacant property (recorded under IAS 16) with a carrying amount of $289,500 at 31 July 2021. On this date, Reilly Co. was able to locate a buyer and the board of the company agreed to sell the property at its present condition. On 31 July 2021, the fair value of the property was $295,000 and the costs to sell it amounted to $7,500. The property has a remaining useful life of 10 years on 31 July 2021. The current year end of Reilly Co. was 31 August 2021 and the sale was completed on 15 September 2021.

1. Explain how the property should be classified on 31 July 2021.
2. Prepare the journal entry for the reclassification as at 31 July 2021. What was the carrying amount of this property at 31 August 2021?