Frost Enterprises buys a warehouse for $ 510,000 to use for its East Coast distribution operations. On the date of the purchase
, a professional appraisal shows a value of $ 610,000 for the warehouse. The seller had originally purchased the building for $ 485,000. Frost has a similar warehouse on the West Coast that has a book value of $ 526,000. Under the historical cost principle, Frost should record the building for:_______.A. $580,000.B. $630,000.C. $594,000.D. $525,000.
Since the historical cost principle states that business must account and record most assets at their purchase or acquisition price which means the data put into record on the balance sheet would reflect amount paid for asset.
