Answered

Westonci.ca is the Q&A platform that connects you with experts who provide accurate and detailed answers. Experience the ease of finding precise answers to your questions from a knowledgeable community of experts. Join our platform to connect with experts ready to provide precise answers to your questions in different areas.

Donner Company is selling a piece of land adjacent to its business premises. An appraisal reported the market value of the land to be $86,722. The Focus Company initially offered to buy the land for $111,289. The companies settled on a purchase price of $212,000. On the same day, another piece of land on the same block sold for $103,641. Under the cost principle, at what amount should the land be recorded in the accounting records of Focus Company

Sagot :

Answer: $212,000

Explanation:

Under the cost principle, the amount that the land should be recorded in the accounting records of Focus Company would be $212,000.

It should be noted that under the cost principle, any property that can be considered to be an asset would have to measured at its cost.

Since the companies settled on a purchase price of $212,000, that'll be the amount that will be recorded.

Thank you for trusting us with your questions. We're here to help you find accurate answers quickly and efficiently. Thank you for choosing our platform. We're dedicated to providing the best answers for all your questions. Visit us again. Find reliable answers at Westonci.ca. Visit us again for the latest updates and expert advice.