Under IFRS, how are investment properties subsequently measured? a) The cost model must be used. b) The cost or fair value models may be used. c) The cost or revaluation models may be used. d) The fair value model must be used.

Under IFRS, how are investment properties subsequently measured? a) The cost model must be used. b) The cost or fair value models may be used. c) The cost or revaluation models may be used. d) The fair value model must be used.

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

ChapterA2: Investments

Section: Chapter Questions

Problem 7DQ

See similar textbooks

Related questions

Q: What text and supplemental information, is there a best choice for using any one specific method of…

A: Investment Valuation: Investment valuation refers to the techniques and procedures employed in…

Q: Create a classification of investment chart to distinguish between simple and nonsimple investment?

Q: Describe the logic underlying the use of target weights to calculate the weighted average cost of…

A: WACC is cost to company which is arising from financing through difference sources according to…

Q: Match each of the following terms with the best definition. A. Theory of constraints B. Sunk cost…

A: Given the following question: Theory of constraints Sunk cost Differential analysis Opportunity…

Q: Apply the procedure to find the true IRR, or return on invested capital, of the mixed investment?

A: The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of…

Q: What is the Joint Hypothesis and what are its implications for tests of asset pricing models?

A: The Capital Asset Pricing Model (CAPM) is a model that explains the relationship between expected…

Q: For which of the following does IFRS for SMEs not provide a simplification of full IFRS?a.…

A: IFRS for SMEs: The majority of companies are non-traded company. These private companies are called…

Q: Choose the correct.For which of the following does IFRS for SMEs not provide a simplification of…

Q: "The valuation of real estate is based on a cobination of facts, assumptions and judgement"…

A: Investment Valuation is a method which has been adopted by the company or the investor to value the…

Q: What is the basis for the estimation of the fair value of the impaired operating resource? For…

A: An asset is said to be impaired if the carrying value or book value of asset is higher than the sum…

Q: From the following identify the cost that is not a cost of PPE? Professional fees Nonrefundable…

A: Property plant and machinery are the fixed assets of the company which helps in production process.…

Q: What is the Fama-MacBeth Method in asset pricing assumptions?

A: Fama Mac Beth method is kind of regression method used for determining of parameters for like CAPM…

Q: What is the difference between VaR as it has been traditionally measured and stressed VaR? Explain…

A: A definition of value at risk is as follows: Value at Risk (VaR) is a metric that estimates the size…

Q: From the following identify the cost that is not a cost of PPE? Professional fees Nonrefundable…

A: A company's physical or tangible long-term assets having a life of at least one year are referred to…

Q: In the case of the net present value technique, explain how the cost of capital is used as a…

A: The question tells about the net present value technique and how the cost of capital is used as a…

Q: After recognition, exploration and evaluation assets are accounted for under the cost model…

A: There are two methods are prescribed by IAS 16 Property, Plant and Equipment for acccount for the…

Q: How is the project profitability index computed, and what does it measure?

A: Profitability Index Profitability index is define as the ratio of net present value of cash inflow…

Q: How can the Income-Tax Rate be used in Project Evaluation?

A: The income tax rate is used to determine the cash flow after tax. As cash flow after tax helps in…

Q: Explain Estimating Development Cost and Interest Carry?

A: INTRODUCTION Estimating development cost in project management is the process of forecasting the…

Q: Describe the process of using the Income-Tax Rate in Project Evaluation?

A: The income tax rate is used to determine the cash flow after tax. As cash flow after tax helps in…

Q: Which is the most accurate and commonly-used Investment Appraisal Method?

A: The profitability criteria of a project over the other can be considered by doing an analysis, that…

Q: A choice of different measurement models can be applied to investment property, namely: the fair…

A: Investment property is the property which is held by the company or by any business which has been…

Q: Explain how differential weight to losses and gains effect investment decisions?

A: Prospect Theory assigns differential weight to losses and gains for making investment decisions.

Q: Investment properties are measured as follows: Initial…

A: The investment properties are measure Initially at cost and subsequently at cost or fair value.

Q: How should changes in the estimated unguaranteedresidual value be handled by the lessor?

Q: What do you understand by Capital cost Allowances (CCA)? What is accelerated CCA? Also, can you…

A: Capital cost allowance A capital cost allowance is a form of depreciation of a capital asset used…

Q: A right of use asset is initially measured at costs and subsequently measured using the A. Cost…

A: An asset is the resource owned by the company for using it in the future.

Q: Comment on the use of probability in investment decision process.

A: Use of probability is a very important tool when it comes to making decisions with regards to…

Q: Which investment return, expected or actual, does GAAP allow in the calculation of benefit cost?

A: Benefit cost: When an entity creates a benefit plan setting aside some moneys to meet future…

Q: The weighted average cost of capital is used to determine whether or not a project should be done.…

A: Solution:- Weighted Average Cost of Capital means the minimum return which a firm should earn in…

Q: The general rule in the accounting treatment of research and development costs is A. Capitalize…

A: This question deals with the IAS 38 "Intangible Asset". As per accounting standard, intangible asset…

Q: How do we use the computed figure when evaluating an investment alternative?

A: There are various computations available for evaluation of investment alternatives. The rate of…

Q: The following provides information regarding Assets X and Y. Calculate the expected rate of return,…

A: Data given: Asset X Probability Return(%) 0.10 8 0.20 9 0.30 11 0.40 12 Asset Y…

Q: When determining the value for vacant land, we look to the following data points for financial…

A: Costs are the expenses which are incurred to construct a property. It is a very important measure…

Q: If a newly acquired asset is ‘held for sale’, the asset or disposal group will be measured at: A.…

A: Held for sale assets are those assets that are acquired for the purpose of sale in short period of…

Q: Describe the process of the Net-Investment Test?

A: The Net-Investment test is done to figure out if an investment is a 'Pure investment' or a 'Mixed…

Q: Which one of the following is an essential characteristic of an asset? A. The inflow of future…

Q: Distinguish between the “cost model” and “fair value” model of accounting for investment property.

A: Investment property is land or a building (including a part of a building) or both that is: →held to…

Q: Select the investment accounting approach with the correct valuation approach: Not…

A: Fair value: Fair value is the price at which, both seller and buyer agree to exchange the asset. So,…

Q: Explain the benefits of a Residual Income structure within an investment center framework.

A: The benefits of residual income are as under : 1) It takes into account the opportunity cost of…

Q: Which control is not a part of the fixed asset system?a. formal analysis of the purchase requestb.…

Q: Describe the process to invest in two assets with similar return characteristics?

A: The investment in any asset depends upon the risk and return of the particular asset and security.…

Q: Which of the following is considered not a Capital expenditure? a. Training costs b. Delivery costs…

A: Lets understand the basics. As per IAS 16 "Property, plant and equipment", initial cost for PPE…

Question

Under IFRS, how are investment properties subsequently measured?

a)	The cost model must be used.

b)	The cost or fair value models may be used.

c)	The cost or revaluation models may be used.

d)	The fair value model must be used.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

SEE SOLUTION Check out a sample Q&A here

Step 1

VIEW

Step 2

VIEW

Step by step

Solved in 2 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.

Similar questions

A choice of different measurement models can be applied to investment property, namely: the fair value model, or cost model. Critically discuss the valuation models in detail
Distinguish between the “cost model” and “fair value” model of accounting for investment property.
Investment properties are measured as follows: Initial Subsequent cost fair value cost or fair value cost or fair value fair value fair value cost cost or fair value
What is the MOST important variable of the financial planning process? Select one: a. The costs b. The capacity of the fixed asset c. The pro forma income statement d. The sales forecast
Which is the most accurate and commonly-used Investment Appraisal Method?
The third step for making a capital investment decision is to establish baseline criteria for alternatives. Which of the following would not be an acceptable baseline criterion? A) accounting rate of return B) payback method C) inventory turnover D) internal rate of return
In the case of the net present value technique, explain how the cost of capital is used as a screening tool.
What is the limitation of payback method as a form of investment appraisal?
Describe the principles of asset valuation. Distinguish between the required rate of return and expected rate of return. Based on the asset valuation, how do the investors make investment decisions using the required rate of return?
After recognition, exploration and evaluation assets are accounted for under the cost model revaluation model fair value model a or b
In order to determine whether an investment is visible, what factors should be considered?
Describe the process of the Net-Investment Test?