Question Details

The equipment will be recorded at a cost of 



Use the following information for questions 1-4. 
A company purchased property for $300,000. The property included an acre of land valued at $50,000, a building valued at $150,000, and equipment valued at $125,000.

	1.	The land will be recorded at a cost of
		a.	$45,000.
		b.	$48,234.
		c.	$46,154.
		d.	$50,000.

	2.	The building will be recorded at a cost of
		a.	$150,000.
		b.	$140,000.
		c.	$135,000.
		d.	$138,461.

3.	The equipment will be recorded at a cost of 
		a.	$125,000.
		b.	$120,000.
		c.	$118,723.
		d.	$115,384.

	4.	The above transaction may be referred to as a 
		a.	market value purchase.
		b.	capital asset purchase.
		c.	property purchase.
		d.	basket purchase.
	
5.	If disposal of a capital asset occurs during the year, amortization is
		a.	not recorded for the year.
		b.	recorded for the whole year.
		c.	recorded for the fraction of the year to the date of the disposal.
		d.	not recorded if the asset is scrapped.





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