Rodriguez Company pays $358,020 for real estate with land, land improvements, and a building. Land is…
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Question “Rodriguez Company pays $358,020 for real estate with land, land improvements, and a building. Land is…”
Rodriguez Company pays $358,020 for real estate with land, land improvements, and a building. Land is appraised at $193,500; land improvements are appraised at $64,500; and a building is appraised at $172,000. Required: 1. Allocate the total cost among the three assets. 2. Prepare the journal entry to record the purchase. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Allocate the total cost among the three assets. (Round your “Apportioned Cost” answers to 2 decimal places.) Appraised Value Percent of Total Appraised Value x Total Cost of Acquisition = Apportioned Cost $ Land Land improvements Building Totals 193,500 64,500 172,000 430,000 45% 15% 40% 100% | $ $ 0.00 (Required 1 Required 2 >
Answer
1. Allocation of total costs among the three assets :- | ||||||
Date | Approved Value | Percentage of Total Appraised Value | x | Total Cost Of Acquisition | = | Partially-Paid Cost |
A | b | c = (b/430000]*100 | d | e =c* | ||
Land | $ 193,500 | 45% | x | 358020 | = | $161,109.00 |
Land improvements | $ 64,500 | 15% | x | 358020 | = | $53,703.00 |
Building | $ 172,000 | 40% | x | 358020 | = | $143,208.00 |
Totals | strongTag14nbsp; 430,000 | 100% | $358,020.00 |
2. Journal entry | |||||
Transaction | General Journal | Debit | Credit | ||
1 | Land | $161,109 | |||
Improvements to Land | $53,703 | ||||
Building | $143,208 | ||||
Cash | $358,020 | ||||
(To register the purchase |
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