YCO F) XYZ Corporation purchased land and an office building for $2,800,000. The real estate contract did not specify the amounts to allocate to the land and to the building. An appraisal delermined the fair market value (FMV) of the land to be $1.000,000 and the fair market value (FMV) of the building to be $3,000,000, a) Please calculate the basis of the land. Show your work b) Please calculate the basis of the building Show your work

Q: The Oscar Corporation acquired land, buildings, and equipment from a bankrupt company at a lump-sum…

A: Total cost  to be assigned = P20,000,000 + P240,000 Total cost  to be assigned = P20,240,000

Q: Johnson acquired for a lumpsum price of P6,000,000 a piece of land and the building on it. The land…

A: Johnson acquired a piece of land and building = P6000000 Fair value of land = $4200000 Building =…

Q: Anderson disposes a vacant lot for P3,000,000.  The lot has an Assessor's fair value of P2,800,000,…

A: What is the basis in the valuation of real property?  The value of the real property will be based…

Q: The Yeet Corporation purchased an office building several years for $200,000. The company took…

A: Section 1231 property is one that is retained by the company for more than one year for use in…

Q: Sisig Corp. purchases a building with land at a cost of P100,000,000. In the sale and purchase…

A: Investment property is the capital assets that are used to earn rental income or capital…

Q: 1. An entity acquired a building for the purpose of leasing it on Jan 1, 2021 for P50 M. At that…

A: Solution: Depreciation on building for 2021 = P50M/40 = P1.25 M

Q: Oman Drydock Company purchased a site near Barka for OMR 25000. In addition to the purchase price…

A: Cost of the asset = Purchase price + tax amount paid  + agent’s commission + legal and registration…

Q: XYZ acquired for a lumpsum price of P6,000,000 a piece of land and the building on it. The land and…

A: Ans. The demolition cost should be expensed in the year the asset is demolished. The old building…

Q: The Oscar Corporation acquired land, buildings, and equipment from a bankrupt company at a lump-sum…

A: Total cost to be assigned = P20,000,000 + P240,000 Total cost to be assigned = P20,240,000

Q: On January 1, 2021, Entity A received land with fair of ₱200,000 from the government conditioned on…

A: Depreciation is the allocation of cost of the asset over the useful life of the asset. There are…

Q: enda Corporation purchased a building for $800,000. The current carrying amount of the building is…

A: Solution: Recoverable amount = higher of fair value or value in use = higher of 360000 or 320000  =…

Q: Parmida sold a Class 1 depreciable asset to a corporation that she controls in exchange for a…

A: Section 85 election is used to reduce or minimize the liability of tax by transferring the eligible…

Q: Atchison Corporation purchased equipment, a building, and land for $1,000,000 ($200,000 in cash and…

A: This is a basket purchase so in this the fair value is used to allocate the purchase of group…

Q: PERIODIC REGULAR Co. acquired a building on January 1, 20x1 for a total cost of ₱24,000,000 and…

A: Definition: Assets: These are the resources owned and controlled by business and used to produce…

Q: The Company intends to demolish the old building, to build a new building and will not use the old…

A: In the given case,  since the Company intends to demolish the old building, to build a new building…

Q: The Bronco Corporation exchanged land for equipment. The land had a book value of $129,000 and a…

A: GIVEN   The Bronco Corporation exchanged land for equipment. The land had a book value of $129,000…

Q: Amelia Corporation purchased a tract of land for the construction of a new office building. The…

A: Cost of Asset = Purchase price(-) Any trade discount + Non-refundable taxes + Directly attributable…

Q: Johnson acquired for a lumpsum price of P6,000,000 a piece of land and the building on it. The land…

A: “Since you have asked multiple sub-parts, we will solve the first three sub-parts for you. If you…

Q: Pinewood Company purchased two buildings on four acres of land. The lump-sum purchase price was…

A: Assets: Property or things owned by company are called Assets. Example: Buildings. Land etc

Q: Simpson and Homer Corporation acquired an office building on three acres of land for a lump-sum…

A: Lets understand the basics. When land, building and furniture purchased cumulatively in single price…

Q: ABC Corp purchased land and building at a lump price of P6M. ABC demolished the building and…

A: All fixed assets in the business should be capitalised. Total costs incurred on acquisition and…

Q: Lauren Ltd bought some land on 1 January 20X4 for GHS 500,000. On 31 December 20X5, this land was…

A: Land is a long term assets for almost all business and it can be revalued at fair value but the…

Q: Lauren Ltd bought some land on 1 January 20X4 for GHS 500,000. On 31 December 20X5, this land was…

A: Recoverable amount = Higher amount of [Fair value less costs to sell or Value in use].

Q: ABC Corp purchased land and building at a lump price of P6M. ABC demolished the building and…

A: The lump sum cost is allocated to assets on the basis of their fair value.

Q: Carter vacated an office building and let it out to a third party on 30 June 20X8. The building had…

A: We have the following information: The building had an original cost of $900,000 on 1 January 20X0…

Q: ABC Co. acquired land, buildings, and equipment from XYZ Co. at a lump-sum price of P1,800,000. ABC…

A: Answer Lum- sum price = P1,800,000 appraisal = P120,000

Q: Concord Corporation purchased the assets of Ivanhoe Company at an auction for $5640000. An…

A: Total of Relative fair values Land $1830000 Building 2910000 Equipment 2250000 Trucks…

Q: Samtech Manufacturing purchased land and building for $3 million. In addition to the purchase price,…

A: Land is the non-current asset that is usually held by the entity for using the same to run its…

Q: On January 1, 2019, ABC Company purchased land at a cost of P 6M. the entity used the revaluation…

A:

Q: ABC Co. acquired land, buildings, and equipment from XYZ Co. at a lump-sum price of P1,800,000. ABC…

A: If the amount paid for purchasing more than one asset then the cost of the asset is determined by…

Q: Red Rock Bakery purchases land, building, and equipment for a single purchase price of $600,000.…

A: Fair value: Fair value is the price at which, both seller and buyer agree to exchange the asset. So,…

Q: Algy Realty receives notice that its property is condemned to make room for a highway. The proceeds…

A: Realized gain or loss refers to those gains or losses which is earned or incurred by the company on…

Q: How much is the loss on the retirement of the old building? b. What would be the capitalized cost…

A: Depreciation is an accounting method where a fund is kept aside so that once the asset becomes…

Q: ABC acquired for a lumpsum price of P6,000,000 a piece of land and the building on it. The land and…

A: A capitalized cost is treated as an expense for a company that is shown in the cost basis of a long…

Q: Me Company owns land and building being used for its operations. Data relating to the land and…

A: Lets understand the basics. As per IAS 40 "Investment property", investment property can be…

Q: Garrett Corporation paid $200,000 to acquire land, buildings, and equipment. At the time of…

A: A journal entry is a form of accounting entry that is used to report a business transaction in a…

Q: f P2,500,000

A: The allocation cost is given as,

Q: Asura Co. purchased land and building for a lump-sum price of P48,000,000. The existing building…

A: Lump-sum purchase: - Lump-sum purchase occurs when different assets or a group of assets are…

Q: ABC Corp purchased land and building at a lump price of P6M. ABC demolished the building and…

A: Cost of building refers to the cost which includes the purchase price which involves price paid to…

Q: Samtech Manufacturing purchased land and building for $3 million. In addition to the purchase price,…

A: 1. Value to be capitalized: Purchase Price $3,000,000 Title Insurance $23,000 Add: Legal fees…

Q: 18. Ryland Company, a calendar year taxpayer, purchased commercial realty for $2 million and…

A: Depreciation is the lessening in the worth of a fixed asset due to obsolescence, erosion or normal…

Q: MAGANDANGEHEMPLO, Inc. obtained a land with an old building, that will be accounted for under…

A: In the given case the company will recognise the construction cost of new building as an asset…

Q: The Jacob Corporation acquired land, buildings, and equipment from a bankrupt company at a lump-sum…

A: Given, Cost of Total Asset = $520,000 Appraised Value = $600,000

Q: ABC acquired for a lumpsum price of P6,000,000 a piece of land and the building on it. The land and…

A: The following calculations are done for ABC Company.

Q: Use the following information for the next two questions: On January 1, 20x1, Entity A acquires a…

A: Impairment of assets means reducing the book value  of assets when carrying amount is more than…

Q: The Chicago Corporation acquired a piece of land in a business combination transaction from the…

A: Fair value definition as per IFRS 13 The price that would be received to sell an asset  in an…

Q: On December 31, 20x1, ABC Co. has no intention of selling a land classified as investment property…

A: Given that as on December 31, 20X1, the company has no intention of selling the land which is…

Q: ABC Corp purchased land and building at a lump price of P6M. ABC demolished the building and…

A: The costs incurred to make the land available for use is included in the cost of land.

Capital Gain

Any capital asset when sold can give the seller a higher or lower price from its purchase price leading to a capital gain or capital loss. The time period of holding an asset is decided based on if it is a long term or short-term capital gain. On that basis, the rate of taxation is decided if it is 20%, 15% or according to the tax brackets. The rate of taxation differs in the case of equity or debt, whether long or short term. The capital gain can be adjusted from capital loss to arrive at a net capital gain. The amount of gains and the exemption has to be reported in the tax return filed in the financial year in which the asset was transferred. The tax return can be filed quarterly, monthly, semi-annually or annually.