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Classic Company and its subsidiaries own the following properties that are accounted for in accordance with international accounting standards:

Classic Company and its subsidiaries own the following properties that are accounted for in accordance with international accounting standards:

FINANCIAL ACCOUNTING
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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Problem 22-1 (IFRS) Classic Company and its subsidiaries own the following properties that are accounted for in accordance with international accounting standards: Land held by the parent for undetermined use 5,000,000 A vacant building owned by the parent and to be leased out under an operating lease 3,000,000 Property held by a subsidiary, a real estate firm, in the ordinary course of business 2,000,000 Property held by the parent for use in production 4,000,000 Building owned by a subsidiary and for which the subsidiary provides security and maintenance services to the lessees 1,500,000 Land leased by the parent to a subsidiary under an operating lease 2,500,000 Property under construction for use as investment property 6,000,000 Land held for future factory site 3,500,000 Machinery leased out by the parent to an unrelated party under an operating lease Required: 1. Compute the total investment property that should be reported in the consolidated statement of financial position of Classic Company and its subsidiaries. 2. Indicate the classification of the assets that are excluded from investment property.
Transcribed Image Text:Problem 22-1 (IFRS) Classic Company and its subsidiaries own the following properties that are accounted for in accordance with international accounting standards: Land held by the parent for undetermined use 5,000,000 A vacant building owned by the parent and to be leased out under an operating lease 3,000,000 Property held by a subsidiary, a real estate firm, in the ordinary course of business 2,000,000 Property held by the parent for use in production 4,000,000 Building owned by a subsidiary and for which the subsidiary provides security and maintenance services to the lessees 1,500,000 Land leased by the parent to a subsidiary under an operating lease 2,500,000 Property under construction for use as investment property 6,000,000 Land held for future factory site 3,500,000 Machinery leased out by the parent to an unrelated party under an operating lease Required: 1. Compute the total investment property that should be reported in the consolidated statement of financial position of Classic Company and its subsidiaries. 2. Indicate the classification of the assets that are excluded from investment property.
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