F1 Exam Dumps : Financial Reporting

OP holds an investment property purchased on 1 January 20X3 for $700,000 with a useful economic life of 25 years.

At 31 December 20X5 the fair value of the investment property was $750,000 with a revised useful economic life of 25 years from that date.

OP has been carrying the investment property using the cost model until 31 December 20X5.

The directors wish to change their valuation method to fair value in accordance with IAS 40 Investment Property.

Which of the following is the correct treatment of the revaluation gain and the value of the property in the statement of financial position at 31 December 20X5?

Entity T operates within several countries, but its country of residence is Country F. In 20X5, Entity T made $8.4 million in Country M. Country M has a flat rate corporation tax of 5.9%.

Country F and Country M operate a double taxation treaty which uses a foreign tax credit system. In Country F, there is a tax of 10% tax on all foreign income.

Taking into account the credit, what is the total tax liability that Entity T owes on its Country M income, in Country F?