CA acquired a tract of land. The seller quoted a price of $30,000 cash, plus a $50,000, 16 percent, one-year, interest-bearing note payable. During later negotiations, the land was appraised by a local real estate agent at $76,000 and was shown on the city tax rolls at an assessed value for tax purposes at $63,000. After considerable negotiation, CA paid $25,000 cash and signed a two-year non-interest-bearing note, payable in two instalments of $30,000 each at the end of each of the next 2 years. The going rate of interest for such transactions was 12 percent. Give the entry to record the land acquisition.

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The Answer of CA acquired a tract of land. The seller quoted a price of $30,000 cash, plus a $50,000, 16 percent, one-year, interest-bearing note payable. During later negotiations, the land was appraised by a local real estate agent at $76,000 and was shown on the city tax rolls at an assessed value for tax purposes at $63,000. After considerable negotiation, CA paid $25,000 cash and signed a two-year non-interest-bearing note, payable in two instalments of $30,000 each at the end of each of the next 2 years. The going rate of interest for such transactions was 12 percent. Give the entry to record the land acquisition.

CA Acquired a Tract of Land