During the year, Donahue Company purchased land and building by issuing 50,000 ordinary shares with P 100 par value. On acquisition date, the shares had a market value of P 140 per share and the land had a fair value of P 2,000,000. No available fair value for the building on that date. During the year, Donahue also received land from a shareholder to facilitate the relocation of its main offices in the city. Donahue paid P 50,000 special tax assessment and P 50,000 legal costs related to transfer the donated land. The donated land is fairly valued at P 1,800,000. What is the total cost of the land acquired during the year? P 3,600,000 P 3,900,000
During the year, Donahue Company purchased land and building by issuing 50,000 ordinary shares with P 100 par value. On acquisition date, the shares had a market value of P 140 per share and the land had a fair value of P 2,000,000. No available fair value for the building on that date. During the year, Donahue also received land from a shareholder to facilitate the relocation of its main offices in the city. Donahue paid P 50,000 special tax assessment and P 50,000 legal costs related to transfer the donated land. The donated land is fairly valued at P 1,800,000. What is the total cost of the land acquired during the year? P 3,600,000 P 3,900,000
Chapter20: Corporations: Distributions In Complete Liquidation And An Overview Of Reorganizations
Section: Chapter Questions
Problem 28P
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During the year, Donahue Company purchased land and building by issuing 50,000 ordinary shares with P 100 par value. On acquisition date, the shares had a market value of P 140 per share and the land had a fair value of P 2,000,000. No available fair value for the building on that date.
During the year, Donahue also received land from a shareholder to facilitate the relocation of its main offices in the city. Donahue paid P 50,000 special tax assessment and P 50,000 legal costs related to transfer the donated land.
The donated land is fairly valued at P 1,800,000.
What is the total cost of the land acquired during the year?
P 3,600,000
P 3,900,000
P 3,850,000
P 3,550,000
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