Question

Larkspur Inc. purchased land, building, and equipment from Laguna Corporation for a cash payment of $390,600. The estimated fair values of the assets are land $74,400, building $272,800, and equipment $99,200. At what amounts should each of the three assets be recorded? (Round intermediate percentage calculations to 5 decimal places e.g. 18.25124 and final answers to 0 decimal places, e.g. 5,275.)

		Recorded Amount
Land		$enter a dollar amount rounded to 0 decimal places
Building		$enter a dollar amount rounded to 0 decimal places
Equipment		$enter a dollar amount rounded to 0 decimal places

Answer 1

Solution: -

At what amounts should each of the three assets be recorded: -

	Recorded Amount
Land	$65,100
Building	$238,700
Equipment	$86,800

Explanation: -

Total fair value = 74,400 + 272,800 + 99,200 = 446,400

Recorded amount for land: -

= 65,100

Recorded amount for building: -

= 238,700

Recorded amount for equipment: -

= 86,800

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