Answer:
The value of building is $950,000
Explanation:
The real estate basis of $1,900,00 can be apportioned between the three assets on the basis of their appraised values as computed below:
The applicable formula=real estate basis*asset appraised value/total appraised values
Total appraised values=$374,000+$1,100,000+$726,000=$2,200,000.00
real estate cost is $1,900,000
land cost =$1,900,000*$374,000/$2,200,000
=$323,000
building cost =$1,900,000*$1,100,000/$2,200,000
=$950,000
equipment cost =$1,900,000*$726,000/$2,200,000
=$627,000
