1. Original Banners pays $220,000 cash for a group purchase of land, building, and equipment. At the time of acquisition, the land has a market value of $34,500, the building $184,000, and the equipment $11,500. Journalize the lump-sum purchase. First, refer to the information provided and calculate the ratio of each asset's market value to the total for all assets combined. Then, complete the table and calculate the assigned cost for each asset. Total Purchase Price Assigned Cost of Each Asset Percentage Market Value of Total Value Asset Land Building Equipment Total Now, journalize the lump-sum purchase. (Record a single compound journal entry. Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Accounts and Explanation Debit Credit Date % % % % x x x =

1. Original Banners pays $220,000 cash for a group purchase of land, building, and equipment. At the time of acquisition, the land has a market value of $34,500, the building $184,000, and the equipment $11,500. Journalize the lump-sum purchase. First, refer to the information provided and calculate the ratio of each asset's market value to the total for all assets combined. Then, complete the table and calculate the assigned cost for each asset. Total Purchase Price Assigned Cost of Each Asset Percentage Market Value of Total Value Asset Land Building Equipment Total Now, journalize the lump-sum purchase. (Record a single compound journal entry. Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Accounts and Explanation Debit Credit Date % % % % x x x =

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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