A Company Purchased Property for a Building Site

question 187

Multiple Choice

A company purchased property for a building site. The costs associated with the property were: What portion of these costs should be allocated to the cost of the land and what portion should be allocated to the cost of the new building?

• A) $175,800 to Land; $18,800 to Building.
• B) $190,000 to Land; $3,800 to Building.
• C) $190,800 to Land; $1,000 to Building.
• D) $192,800 to Land; $0 to Building.
• E) $193,800 to Land; $0 to Building.