Ten years ago a corporation purchased a building for $160,000.At that time,the corporation felt that the business was worth $185,000.The current market value of the business is $460,000.The building has been assessed at $435,000 for property tax purposes.At which amount should the corporation record the building in its accounting records?

Question

Quizplus · Accepted Answer

The building should be recorded at its historical cost, which is the purchase price of $160,000, according to accounting principles.

Ten Years Ago a Corporation Purchased a Building for $160,000