Multiple Choice Quiz: A building is offered for sale at $500,000 but is currently assessed at $400,000. The purchaser of the building believes the building is worth $475,000, but ultimately purchases the building for $450,000. The purchaser records the building at: a. $50,000. c. $450,000. e. $500,000. b. $400,000. d. $475,000.

Multiple Choice Quiz: A building is offered for sale at $500,000 but is currently assessed at $400,000. The purchaser of the building believes the building is worth $475,000, but ultimately purchases the building for $450,000. The purchaser records the building at: a. $50,000. c. $450,000. e. $500,000. b. $400,000. d. $475,000.

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter9: Acquisitions Of Property

Section: Chapter Questions

Problem 42P

See similar textbooks

Similar questions

A building is offered for sale at $500,000 but is currently assessed at $400,000. The purchaser of the building believes the building is worth $475,000, but ultimately purchases the building for $450,000. The purchaser records the building at: a. $50,000. c. $450,000. e. $500,000. b. $400,000. d. $475,000.
You purchase a multifamily property for $4,500,000. You commission a cost segregation study to determine how the cost should be allocated and determine the following:\\n\\nLand: 30%\\n\\nResidential Improvements: 55%\\n\\nLand Improvements: 10%\\n\\nFurniture, Fixtures & Equipment: 5%\\n\\nWhat is your projected depreciation expense associated with this property? (Round your answer to the nearest dollar)\\nPlease provide an excel file with labels and formulas, Thank you
(Multiple Choice Question) Vanessa recently paid $200,000 cash to purchase both a building and equipment. The fair market value of the building is $180,000, and the fair market value of the equipment is $40,000. When recording this purchase, Vanessa should 1. None of the answers are correct 2. Credit Cash for $200,000 and Credit Mortgage Payable for $20,000 3. Debit Building for $198,000 and Equipment for $44,000 4. Debit Building for $180,000 and Equipment for $40,000 5. Debit Building for $163,636.36 and Equipment for $36,363.64
A real estate management company buys an apartment complex for $4.8 million. An appraiser values the land at $1.1 million, the building at $3.4 million, and the equipment at $0.3 million. In addition, the company pays a 5% commission to a broker for arranging the sale. Which of the following statements is true? Multiple Choice The company would record $3.7 million as the acquisition cost of the building The company would record $3.57 million as the acquisition cost of the building None of the other alternatives are correct The company would record $0.24 million as an expense and $4.8 million as an asset. The company would record $1.1 million as the acquisition cost of the land.
Aber Company buys land for $145,000 in 2021. As of 3/31/22, the land has appreciated in value to $151,000. On 12/31/22, the land has an appraised value of $155,400. By what amount should the Land account be increased in 2022? Group of answer choices $6,000 $4,400 $0 $10,400
An investor is considering the acquisition of a “distressed property” which is on Northlake Bank’s REO list. The property is available for $203,400 and the investor estimates that he can borrow $160,000 at 4.5 percent interest and that the property will require the following total expenditures during the next year: Inspection $ 551 Title search 1,102 Renovation 13,000 Landscaping 902 Loan interest 7,251 Insurance 1,851 Property taxes 6,051 Selling expenses 8,000 Required: a. The investor is wonderin
Fresh Veggies, Inc. (FVI), purchases land and a warehouse for $490,000. In addition to the purchase price, FVI makes the following expenditures related to the acquisition: broker’s commission, $29,000; title insurance, $1,900; and miscellaneous closing costs, $6,000. The warehouse is immediately demolished at a cost of $29,000 in anticipation of building a new warehouse. Determine the amount FVI should record as the cost of the land.
Land, a building and equipment are acquired for a lump sum of $900,000. The market values of the land, building an equipment are $500,000, $600,000 and $200,000, respectively. What is the cost assigneed to the equipment? (Do not round to any intermediary calculations and round your final answer to the nearest dollar). A. $0 B. $900,000 C. $200,000 D. $138,462 thnaka sfor help appareicated
A building with an appraisal value of $125,601 is made available at an offer price of $153,140. The purchaser acquires the property for $31,231 in cash, a 90-day note payable for $23,994, and a mortgage amounting to $57,725. The cost of the building to be reported on the balance sheet is a.$121,909 b.$125,601 c.$112,950 d.$153,140
CPL a manufacturing company, purchases a property for $1M on January 20x1 for its investment potential. The land element of the cost is believed to be $ 400,000 and the building element is expected to have a useful life of 50 years. At December 31, 20x1, local property indices suggest that fair value of the property has risen to $ 1.1M. Required: Show how the property would be presented in the Financial Statements at December 31, 20x1 if CPL adopts: (a) the cost model (b) the fair value models
Question Content Area The president of Christmas Corporation donated a building to Tuesday Corporation. The building had an original cost of $675,000, a book value of $255,000, and a fair market value of $475,000. The journal entry by Tuesday Corporation to record this donation will include a debit Building for $675,000 and credit Gain for $200,000. debit Building for $255,000 and credit Gain for $255,000. debit Building for $475,000 and credit Gain for $200,000. debit Building for $475,000 and credit Gain for $475,000.
On November 18 of year 1, Javier purchased a building, including the land it was on, to assemble his new equipment. The total cost of the purchase was $1,500,500; $363,000 was allocated to the basis of the land and the remaining $1,137,500 was allocated to the basis of the building. (Use MACRS Table 1, Table 2, Table 3, Table 4 and Table 5.) Note: Do not round intermediate calculations. Round your answers to the nearest whole dollar amount. d. Assume the building is residential property. Using MACRS, what is Javier's depreciation deduction on the building for years 1 through 3? e. What would be the depreciation for 2022, 2023, and 2024 if the property were nonresidential property purchased and placed in service November 18, 2005 (assume the same original basis)?