Week 3: Fair value vs cost Flashcards
1
Q
In tax law, what percent of a property depreciation goes to land and what percent goes to building
A
20% of a property goes to land, 80% goes to the building
2
Q
Fair value vs cost
A
Used to value assets
Fair value is how much it currently is worth
Cost means that how much you paid for it
3
Q
For tax purposes, residential and commercial real estate depreciate in…
A
residential 27 years
commercial 39 years
4
Q
US GAAP vs IFRS (regarding depreciation)
A
US GAAP only allow historical cost
IFRS allows cost or fair value technique
