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Explain the treatment of the building in financial statement

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ABC Ltd prepares accounts to 31 December. It acquired an administration block with an estimated useful life of 50 years at a cost of GHS22 million on 1 January 2013. The entity used the building until 1st April 2019, when it moved its office to a new building at the factory site. The building was reclassified as an investment property and leased out under a 40 year lease. The fair values of the building at 1st April 2019 and 31st December 2019 were GHS21 million and GH21.5 million respectively
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Question 1: Explain the treatment of the building in the 2019 financial statements (Statement of Profit and Loss for 2019 and Statement of financial position as at 31 December 2019) on the assumption that the entity uses the fair value model for investment properties.

Reference no: EM132613815

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