A company paid $595,000 for property that included land appraised at $384,000; land improvements appraised at $128,000; and a building appraised at $288,000. The plan is to use the building as a manufacturing plant. Determine the amounts that should be recorded as:(a)Land…………………. $________(b)Land Improvements.... $________(c)Building……………… $________
What will be an ideal response?
| Asset | Appraised Value | ? | Percent of Total | Apportioned Cost |
| Land | $384,000 | /$800,000 = | 48% | $285,600 |
| Land Improvements | 128,000 | /$800,000 = | 16% | 95,200 |
| Building | 288,000 | /$800,000 = | 36% | 214,200 |
| Totals | $800,000 | ? | 100% | $595,000 |
Business
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