Ten Years Ago,a Company Purchased a Building for $190,000

question 89

Multiple Choice

Ten years ago,a company purchased a building for $190,000.At that time,the company felt that the building was worth $215,000.The current market value of the building is $450,000.The building has been assessed at $425,000 for property tax purposes.At which amount should the company record the building in its accounting records?

• A) $190,000
• B) $215,000
• C) $425,000
• D) $450,000

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Definitions:

Units-Of-Activity

A depreciation method that allocates the cost of an asset over its useful life based on its actual usage or activity level.

Factory Machinery

Refers to the physical equipment used in the production process within a manufacturing facility.

Delivery Equipment

Assets such as trucks and vans that are used by a business to transport products to customers.

Buildings

Physical structures owned by a business or entity used for operations, manufacturing, or office space.