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I have seen conflicting information. Your notes say that land is always operating, but in the BPP book it says it could be financing ( PV of “land portion” is substantially all of land FV) . Can somebody in the know give me a quick ruling ?
I would not describe myself as someone in the know but the following link suggests that in some unusual circumstances land can be part of finance lease.Hope this helps-
https://www.accaglobal.com/uk/en/student/exam-support-resources/fundamentals-exams-study-resources/f7/technical-articles/How-to-account-for-property.htmlThank you Mrjonbain, strangely that made it worse. I guess very long term land leases only are considered finance.
I thought the the present value of the land portion payments is a …..thing to consider, but if that article doesn’t mention then ….it isn’t?LOL (I am actually laughing in the library )
Oh, well. Thank you
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