Use the following information to answer the following questions. Izabelle and Marta are forming a partnership. Izabelle will invest a piece of equipment with a book value of $7,500 and a fair market value of $20,000. Marta will invest a building with a book value of $40,000 and a fair market value of $58,000.
What amount will be recorded to the building account?

Question

Quizplus · Accepted Answer

The building should be recorded at its fair market value of $58,000, as this reflects the current value of the asset being contributed to the partnership.

Use the Following Information to Answer the Following Questions