ABC Inc Purchased a Shopping Complex and with It, a Large

question 198

Multiple Choice

ABC Inc. purchased a shopping complex and with it, a large condominium complex attached to it in the amount of $20,000,000 on January 1, 2013. Both complexes are designated investment property. Both facilities are estimated to have a useful life of eighteen years and a salvage value of $2 million dollars. On December 31^st, 2013, the fair value of both complexes was $25 million. ABC Inc. prepares its financial statements under IFRS. Assuming that ABC uses the Fair Value Model to account for the complex, the carrying value of both complexes on December 31^st, 2013 would be:

• A) $16 million.
• B) $25 million.
• C) $18 million.
• D) $19 million.

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Definitions:

Spatial Equivalence

The concept that two or more entities occupy the same area or space in relation to each other.

Propositional Representation

The theory that all knowledge can be expressed in semantic-based propositions or statements, depicting relationships between concepts.

Verbal

Pertaining to words and language, especially the use and understanding of words in communication and reasoning.

Visual

Relating to seeing or sight, involving the use and interpretation of visual information.