On January 1, 2022, an SME acquired a building for P10,450,000 including P500,000 nonrefundable purchase taxes. The purchase agreement provided for payment to be made in full on December 31, 2022. Legal fees of P220,000 were incurred in acquiring the building and paid on January 1, 2014. The building is held to earn lease rentals and for capital appreciation. The discount rate is 10%. What is the initial cost of the investment property? *
On January 1, 2022, an SME acquired a building for P10,450,000 including P500,000 nonrefundable purchase taxes. The purchase agreement provided for payment to be made in full on December 31, 2022. Legal fees of P220,000 were incurred in acquiring the building and paid on January 1, 2014. The building is held to earn lease rentals and for capital appreciation. The discount rate is 10%. What is the initial cost of the investment property? *
Chapter8: Depreciation, Cost Recovery, Amortization, And Depletion
Section: Chapter Questions
Problem 23CE
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Question
On January 1, 2022, an SME
acquired a building for
P10,450,000 including
P500,000 nonrefundable
purchase taxes. The purchase
agreement provided for
payment to be made in full on
December 31, 2022. Legal fees
of P220,000 were incurred in
acquiring the building and paid
on January 1, 2014. The
building is held to earn lease
rentals and for capital
appreciation. The discount
rate is 10%. What is the initial
cost of the investment
property? *
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