MFRS 140 Investment Property

MFRS 140 allows which two measurement models for investment property after initial recognition?

• Cost Model and Revaluation Model

• Cost Model and Fair Value Model

• Revaluation Model and Historical Cost Model

• Amortised Cost Model and Cost Model

Under the fair value model in MFRS 140, how are changes in the fair value of an investment property recognised?

• In the revaluation reserve in equity

• In other comprehensive income (OCI)

• In profit or loss

• Not recognised unless sold

Which of the following properties is considered an investment property under MFRS 140?

• A property held for sale in the ordinary course of business

• A property use for administrative purpose

• A building rented out to earn rental income

• A property occupied by the owner for business operations

Which of the following best describes the main purpose of investment property under MFRS 140?

• To use in the production or supply of goods or services

• To earn rental or for capital appreciation

• To be used for administrative purposes

• To be sold in the ordinary course of business

After transferring to PPE, how is the building subsequently measured under the revaluation model?

• At cost less accumulated depreciation

• At fair value with changes to OCI

• At cost with revaluation surplus in P&L

• At depreciated fair value with no adjustments

What happens when an investment property is reclassified as owner-occupied property?

• It continues to be accounted under MFRS 140

• It must be sold immediately

• It is accounted for under MFRS 116 from the date of change in use

• It is derecognized

When must an entity transfer a property to or from investment property?

• Only at the beginning of the financial year

• When market value increases

• When management decides to sell it

• When there is a change in use

Can an investment property be depreciated under the fair value model?

• No, depreciation is not applicable under the fair value model

• Yes, always

• Yes, but only for land

• Only under certain conditions

Xara Bhd purchased a building classified as investment property on 1 January 2022 for RM1,200,000. The company uses cost model and estimates the useful life of the building is 40 years, with no residual value. What is the depreciation expense for the year ended 31 December 2023?

• RM20,000

• RM40,000

• RM60,000

• RM30,000

Fajar Sdn Bhd acquired an investment property on 1 January 2021 for RM2,000,000. The company uses the cost model and depreciates the property over 50 years using the straight-line method. What is the carrying amount of the property as at 31 December 2023?

• RM1,880,000

• RM1,920,000

• RM1,960,000

• RM1,840,000