2. ABC Ltd acquired a property on 1 January 2004 at a cost of 4 GH¢00,000 and immediately occupied it as office premise. On acquisition, it was estimated to have a useful life of 50 years. Subsequent to its acquisition, the asset was measured at depreciated cost until 1 October 2009 when management of ABC decided to convert the building into an investment property (mainly for rentals). Following this decision, the property was fair valued at GH¢380,000. ABC adopted the fair value model for subsequent measurement of the investment property. At 31 December 2009, it was fair valued at GH¢390,000.

2. ABC Ltd acquired a property on 1 January 2004 at a cost of 4 GH¢00,000 and immediately occupied it as office premise. On acquisition, it was estimated to have a useful life of 50 years. Subsequent to its acquisition, the asset was measured at depreciated cost until 1 October 2009 when management of ABC decided to convert the building into an investment property (mainly for rentals). Following this decision, the property was fair valued at GH¢380,000. ABC adopted the fair value model for subsequent measurement of the investment property. At 31 December 2009, it was fair valued at GH¢390,000.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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