10. Paraiso company’s accounting policy with respect to investment properties is to measure them at fair value at the end of each reporting period. One of the investment properties was measured at 12,000,000 on Dec. 31, 2015. The property had been acquired on January 1, 2015 for a total of 11,400,000, made up of 10,350,000 paid to the vendor, 450,000 paid to the local authority as a property transfer tax and 600,000 paid to professional advisers. The useful life of the property is 40 years. What is the gain to be recognized for the year ended December 31, 2015 in respect of the investment property?

10. Paraiso company’s accounting policy with respect to investment properties is to measure them at fair value at the end of each reporting period. One of the investment properties was measured at 12,000,000 on Dec. 31, 2015. The property had been acquired on January 1, 2015 for a total of 11,400,000, made up of 10,350,000 paid to the vendor, 450,000 paid to the local authority as a property transfer tax and 600,000 paid to professional advisers. The useful life of the property is 40 years. What is the gain to be recognized for the year ended December 31, 2015 in respect of the investment property?

SWFT Corp Partner Estates Trusts

42nd Edition

ISBN:9780357161548

Author:Raabe

Publisher:Raabe

Chapter14: Taxes On The Financial Statements

Section: Chapter Questions

Problem 24CE

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