As at 31 December 2020, Lambda Ltd’s property in its statement of financial position was: Property at cost (useful life 15 years) $4,500,000 Accumulated depreciation $600,000 On 1 July 2021, Lambda Ltd decided to sell the property. The property is being marketed by a property agent at a price of $4,200,000, which was considered a reasonably achievable price at that date. The expected costs to sell have been agreed at $100,000. Recent market transactions suggest that actual selling prices achieved for this type of property in the current market conditions are 10% less than the price at which they are marketed. At 31 December 2021 the property has not been sold. At what amount should the property be reported in Lambda Ltd’s statement of financial position as at 31 December 2021? $3,600,000   $3,750,000   $3,680,000   $4,200,000

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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As at 31 December 2020, Lambda Ltd’s property in its statement of financial position was:

Property at cost (useful life 15 years)

$4,500,000

Accumulated depreciation

$600,000

On 1 July 2021, Lambda Ltd decided to sell the property. The property is being marketed by a property agent at a price of $4,200,000, which was considered a reasonably achievable price at that date. The expected costs to sell have been agreed at $100,000. Recent market transactions suggest that actual selling prices achieved for this type of property in the current market conditions are 10% less than the price at which they are marketed. At 31 December 2021 the property has not been sold.

At what amount should the property be reported in Lambda Ltd’s statement of financial position as at 31 December 2021?

  1. $3,600,000

     
  2. $3,750,000

     
  3. $3,680,000

     
  4. $4,200,000

 

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