The cost of the land, building and machinery would be reported at: a. Land= P 530,000; Building= P4,600,000; Machinery= P 2,370,000b. Land= P 500,000; Building= P4,400,000; Machinery= P 2,300,000c. Land= P 625,000; Building= P5,600,000; Machinery= P 2,675,000d. Land= P 655,000; Building= P5,400,000; Machinery= P 2,745,000 On Dec. 31, 2021, the property, plant and equipment account of Pearl Company include the details belowPlant assets acquired from Zee CompanyP 7,500,000Repairs made on building prior to occupancy200,000Special tax assessment125,000Construction of platform for machinery175,000Remodeling of office space in building including new partitions andPurchase of new machinery400,0001,000,000P 9,400,000Total Property, plant and equipmentIn exchange for the plant assets of Zee Company, Pearl Company ussued 50,000 shares with P 100par value. On the date of purchase, the share had a quoted price of P 150 and the plant assets hadthe following fair valueLandP500,000BuildingMachinery5,000,0001,500,000

It is a general principle in Accounting that the assets are…

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Business

Accounting

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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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Question

The cost of the land, building and machinery would be reported at:

a. Land= P 530,000; Building= P4,600,000; Machinery= P 2,370,000
b. Land= P 500,000; Building= P4,400,000; Machinery= P 2,300,000
c. Land= P 625,000; Building= P5,600,000; Machinery= P 2,675,000
d. Land= P 655,000; Building= P5,400,000; Machinery= P 2,745,000

On Dec. 31, 2021, the property, plant and equipment account of Pearl Company include the details below
Plant assets acquired from Zee Company
P 7,500,000
Repairs made on building prior to occupancy
200,000
Special tax assessment
125,000
Construction of platform for machinery
175,000
Remodeling of office space in building including new partitions and
Purchase of new machinery
400,000
1,000,000
P 9,400,000
Total Property, plant and equipment
In exchange for the plant assets of Zee Company, Pearl Company ussued 50,000 shares with P 100
par value. On the date of purchase, the share had a quoted price of P 150 and the plant assets had
the following fair value
Land
P
500,000
Building
Machinery
5,000,000
1,500,000

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