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Use IFRS Happy Cow acquired the farm house, which it rents to the neighboring farmer, on 1 January 2016 for 10 mio. CHF. The useful
Use IFRS
Happy Cow acquired the farm house, which it rents to the neighboring farmer, on 1 January 2016 for 10 mio. CHF. The useful life of the building is 40 years. While during the first year the value of the building remains constant, the Swiss farm land develops to become a popular neighborhood with many other agricultural companies nearby. Hence, at the end of 2017, the value of the building increases up to 18 mio. CHF. In 2018, severe defects related to the building are detected. At the end of 2018, an independent expert estimates a new value of 9 mio. CHF only due to the necessary reparations. In early 2019, the defects turn out to be less severe than expected. The same expert makes an adjustment to the previous year's estimate and the new estimated value of the building at the end of 2019 is 12 mio. CHF. What is the impact on HappyCow's balance sheet and income statement at the end of the years 2016, 2017, 2018, and 2019 under the cost model versus the fair value model
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