question archive Land was acquired in 2013 for a future building site at a cost of $40,400
Land was acquired in 2013 for a future building site at a cost of $40,400
Subject:BusinessPrice:2.87 Bought7
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Land was acquired in 2013 for a future building site at a cost of $40,400. The assessed valuation for tax purposes is $28,700, a qualified appraiser placed its value at $48,800, and a recent firm offer for the land was for a cash payment of $44,500. The land should be reported in the financial statements at: |
| a) | $ 48,800. |
| b) | $ 28,700. |
| c) | $ 40,400. |
| d) | $ 44,500. |
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Answer:
In financial statments fixed assets are recorded at a price lower of the following:
1.Historical cost i.e. cost purchased
2. Market Value
In the case the historical cost is lower.Hence should be recorded in the financial statements at 40400
