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Elena L [17]
3 years ago
14

A company acquired an office building, land, and equipment in a single basket purchase. The fair values were $1,200,000, $600,00

0, and $200,000 for the building, land, and equipment, respectively. The company recorded the building for $1,080,000. What was the total purchase cost for all three assets?
Business
1 answer:
oksian1 [2.3K]3 years ago
6 0

Answer:

The total purchase cost for all three assets is $1,800,000.

Explanation:

Ratios based on fair values were:

6: 3: 1 for Office Building $1,200,00 : Land $600,000 : Equipment $200,000.  Therefore, office building represents 60%, Land 30%, and Equipment 10% of the cost.

Since the Office building costs $1,080,000, using the above fair values ratio, this cost represents 60% of the total.

Therefore, the total cost will be $1,800,000 ($1,080,000/60 X 100).

The total purchase cost for all three assets is obtained using the proportion method of cost allocation based on the given fair values.

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Refer to the scenario to answer the following questions. A government worker surveys a number of households and comes up with th
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Answer:

Explanation:

I honestly don't know how to answer this, but I can look into it and get back to you.

3 0
3 years ago
Colorado Mountain Mining paid $ 896,900 for the right to extract mineral assets from a 500,000​-ton deposit. In addition to the
Zepler [3.9K]

Answer:

(a) The asset would be recorded in accordance to IAS 16 Property, plant & equipment.

Dr  Mining Asset   896,900

Cr       Bank                     896,900

(b) IAS 16 says that the costs incurred to make the asset ready for use must be capitalized as part of the asset. This means the license fee $1000 filing fee, License fee $2100 and $50,000 amount paid for geological survey must be capitalized. So the entry is as under:

Dr Mining asset (1k+2.1k+50k) $53,100

Cr                      Bank                       $53,100

(c) This assets must be depreciated on the basis of tons of minerals extracted which is 60 thousands tons in the first year.

Depreciation Expense = (60k tons / 500k tons)   * (Total capitalized cost)

=(60,000/500,000) * (896,900+53,100) = $108,000

The Double entry of Depreciation Expense would be as under:

Dr Depreciation Expense  $108,000

Cr                Accumulating Depreciation  $108,000

3 0
3 years ago
Emma, Inc. reacquired 166,326 of its shares at $22 per share as treasury stock. Last year, for the first time, Emma sold 37,992
Lesechka [4]

Answer:

The correct answer is $152,949.

Explanation:

According to the scenario, the given data are as follows:

Reacquired shares = 166,326

Per share price = $22

So, we can calculate the retained earning decline by using following formula:

Retained earning decline = Cost of Treasury shares - Sales price - Paid in Capital from stock

Where, Cost of treasury shares = 48,987 × $22 = $1,077,714

Now Sales Price = 48,987 × $15 = $734,805

and Paid in Capital from stock = 37,992 × ( $27 - $22) = $189,960

By putting the value in the formula, we get:

Retained earning decline = $1,077,714 - $734,805 - $189,960

= $152,949

6 0
2 years ago
Spokes Bikes has 18 different bicycle models that can be created in over 2 million combinations. Each combination is designed to
vampirchik [111]

Answer:

Correct option is (C)

Explanation:

Mass customization refers to manufacturing products suited for individual needs and preferences at the same time producing huge amount of products at low cost offering value to customers.

Customers are allowed to make modifications as per their requirements in the basic model offered by the organization. So customer is free to pick the color, design and model of their choice.

Spokes bikes is therefore using mass customization.

3 0
3 years ago
You bought a stock for $28.29 and sell it for $35 after four years. What was the true annual rate of return (compounded)
Irina18 [472]

Answer:$1.68

Explanation:

4 0
2 years ago
Read 2 more answers
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