Question

A company purchased property for $100,000. The property included a building, a parking lot, and land. The building was appraised at $54,000; the land at $51,400, and the parking lot at $19,600. Land should be recorded in the accounting records with an allocated cost of: Multiple Choice $0. $51,400. $100,000. $47,120. $41,120.

Answer 1

Answer:

$41,120

Explanation:

Since we know that assets are recorded in accounting at their purchase price including related costs.

Therefore;

The total appraised value = $54,000 + $51,400 + $19,600

= $125,000

Since the appraisal value for the land is $51,400, then the land will be recorded as ;

= $51,400/$125,000 × $100,000

= $41,120