During the year,a wealthy local merchant donated a building to the City of Rosewood.The original cost of the building was $300,000.Accumulated depreciation at the date of the gift amounted to $250,000.The appraised fair market value of the donation at the date of the gift was $600,000,of which $40,000 was the value of the land on which the building was situated.At what amount should this contribution be recorded in the governmental activities accounts at the government-wide level?

Question

Quizplus · Accepted Answer

The contribution should be recorded at its fair market value at the date of the gift, which is $600,000. This amount includes the value of the land on which the building was situated, which is $40,000. The accumulated depreciation of $250,000 should not be considered in determining the value of the contribution. Therefore, the correct amount to be recorded in the governmental activities accounts at the government-wide level is $600,000.

During the Year,a Wealthy Local Merchant Donated a Building to the City