Question

Larkspur Brothers Inc. purchased land and an old building with the intention of removing the old building and then constructing the company’s new corporate headquarters on the land. The land and old building were purchased for $590,000. Closing costs were $5,150. The old building was removed at a cost of $46,500. After readying the land for its intended use, and while waiting for construction to begin, Larkspur generated net revenue of $3,130 from using the land as a parking lot.

Determine the amount to be recorded as the land cost, and the treatment of the net revenue of $3,130, if Larkspur prepares financial statements in accordance with IFRS and ASPE.

		IFRS		ASPE
Land cost		$		$

Can you plz make sure you answer this question correctly because it is the second time I am posting this question ?

Answer 1

Please hit LIKE button if this helped. For any further explanation, please put your query in comment, will get back to you.
IFRS
Land Cost	$590,000+$5,150+$46,500		$641,650
Under IFRS, any revenue generated before completion of asset, is not considered as part of Asset
$3,130 will be considered as Revenue in income statement when earned
ASPE
Land Cost	$590,000+$5,150+$46,500		$641,650
Under ASPE, $3,130 of revenue will be considerd as part of asset and will be credited to Building account