In 2012,the Denim Company bought land that cost $15,000.In 2018,a similar piece of land was bought for $28,000 and the company's existing land was estimated to be worth $18,000.On the balance sheet at the end of 2018,the land that was purchased in 2012 would be reported at:

Question

Quizplus · Accepted Answer

Under the historical cost principle in accounting, assets are recorded and reported at their original purchase price. Therefore, the land purchased in 2012 would be reported at its original cost of $15,000, regardless of its current market value.

In 2012,the Denim Company Bought Land That Cost $15,000