Show how the property would be measured

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Question - At the audit of MCQ Corporation, you have found that a property was purchased for P500,000 on 1 January 2017. The useful life of the property is 20 years (zero residual value). The property is being measured subsequently at depreciated historical cost.

On 31 December 2018, it was decided that the property was to be classified as held for sale (classification criteria were met). An impairment assessment on 31 December 2018 had determined the recoverable value (based on value in use) to be P400,000. The Fair Value less Costs to Sell on 31 December 2018 was P390,000.

At 31 December 2019, there is a change in plans and the property no longer meets the criteria to be classified as held for sale. There is no change in the useful life of the property at any point. The recoverable value at 31 December 2019 is P385,000. Show how the property would be measured (accounted) for in 2018 and 2019.

Reference no: EM132547969

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