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i’ve an question about why we apply revaluation model to PPE,but when we measure investment property we use fair value model.
Maybe because PPE is bought and held for use in the business. Investment property is bought and held for its potential for capital growth or income generation.
So PPE is valued on a depreciated historic cost basis ( or revaluation as an allowed alternative ) where investment property is fair valued each year reflecting the purpose for which it was bought – ie an increase in value
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@mikelittle said:
Maybe because PPE is bought and held for use in the business. Investment property is bought and held for its potential for capital growth or income generation.
So PPE is valued on a depreciated historic cost basis ( or revaluation as an allowed alternative ) where investment property is fair valued each year reflecting the purpose for which it was bought – ie an increase in valueI got it Thanks!!!
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what is fair value
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