Question

Select the correct statement. *

-A leasing company should treat all its assets used in providing lease services as investment property.

-Investment properties that are to be disposed of without further development are treated as investment property until they are derecognized.

-All investment properties held for capital appreciation will be classified as held for sale in the long run.

-Investment properties being re-developed as investment properties on behalf of third parties are investment properties.

(explain)

Answer 1

The correct answer is First statement.

A Leasing Company should treat all its assets used in providing lease service as investment property, because Assets which are given on lease are going to generate revenue in term of lease rentals, so it need to be considered as investment propperty.

Generally any kind of Investment may be in terms os shares, bonds, fixed deposits, etc. provide us some amount of financial growth may be monthly, quarterly, half yeraly, yearly.

So applying same for the leasing company , assets which are given on lease agreement will provide lease rental from lessee, will considered as investment property.