The draft financial statements of Blue Oak Investments for the year to 31 December 20X9 are being prepared and the accountant has requested your advice on dealing with the following issues A. Blue Oak Investments has an administration building which it no longer needs following a delayering exercise. On 1 July 20X9 Blue Oak Investments entered into an agreement to let the building out to another company. The building cost $600,000 on 1 January 20X0 and is being depreciated over 50 years. Blue Oak Investments applies the fair value model under IAS 40 and the fair value of the building was judged to be $800,000 on 1 July 20X9. This valuation had not changed at 31 December 20X9. Another building has been let out for a number of years. It had a fair value of $550,000 at 31 December 20X8 and $740,000 at 31 December 20X9. Explain how these two buildings should be accounted for in the financial statements of Blue Oak Investments for the year to 31 December 20X9 and quantify the amounts involved.
The draft financial statements of Blue Oak Investments for the year to 31 December 20X9 are being prepared and the accountant has requested your advice on dealing with the following issues
A. Blue Oak Investments has an administration building which it no longer needs following a delayering exercise. On 1 July 20X9 Blue Oak Investments entered into an agreement to let the building out to another company. The building cost $600,000 on 1 January 20X0 and is being
Another building has been let out for a number of years. It had a fair value of $550,000 at 31 December 20X8 and $740,000 at 31 December 20X9.
Explain how these two buildings should be accounted for in the financial statements of Blue Oak Investments for the year to 31 December 20X9 and quantify the amounts involved.
Step by step
Solved in 2 steps
