Use the Following Information for Questions

question 53

Multiple Choice

Use the following information for questions
On March 1, 2010, Beck Company purchased land for an office site by paying $270,000 cash.Beck began construction on the office building on March 1.The following expenditures were incurred for construction:

The office was completed and ready for occupancy on July 1.To help pay for construction,
$360,000 was borrowed on March 1, 2010 on a nine percent, three-year note payable.Other than the construction note, the only debt outstanding during 2010 was a $150,000, 10%, six-year note
payable dated January 1, 2010.
-A company owns assets that qualify as investment property and applies the fair value model for all such property.Assuming the assets are expected to be used for 10 years and have a year-1 book value of $100,000, depreciation expense for that year is:

• A)$10,000
• B)nil
• C)$15,000
• D)$9,000

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