Anderson Company has purchased a group of assets for $23,800.The assets and their relative market values are listed below. Which of the following amounts would be debited to the Land account? (Round any intermediate calculations to two decimal places,and your final answer to the nearest dollar. )

Question

Anderson Company has purchased a group of assets for $23,800.The assets and their relative market values are listed below.  Which of the following amounts would be debited to the Land account? (Round any intermediate calculations to two decimal places,and your final answer to the nearest dollar. )

Quizplus · Accepted Answer

Cost of land = Lump-sum purchase price × [Land / (Land + Equipment + Building)] =
$23,800 ×[ $7200 / ($7200 + $2100 + $3300)] = $13,566

Anderson Company Has Purchased a Group of Assets for $23,800