Problem 11-23 (AICPA Adapted) At the begining of the current year, Diamond Company purchased a tract of land for P12,000,000. The entity incurred additional cost of PB,000,000 during the remainder of the year in subdividing the land for aale Of the tract nccrenge, 70% was subdivided into residential lots and 30% was conveyed to the city for roads and a park Lot elass Number of lots Sale price per lot 100 100 200 240,000 160,000 100,000 Using the relative sales value method, what amount of cot should be allocated to Class A lota a 3,000,000 b. 3,750,000 C. 6,000,000 d. 7,200,000 888

Problem 11-23 (AICPA Adapted) At the begining of the current year, Diamond Company purchased a tract of land for P12,000,000. The entity incurred additional cost of PB,000,000 during the remainder of the year in subdividing the land for aale Of the tract nccrenge, 70% was subdivided into residential lots and 30% was conveyed to the city for roads and a park Lot elass Number of lots Sale price per lot 100 100 200 240,000 160,000 100,000 Using the relative sales value method, what amount of cot should be allocated to Class A lota a 3,000,000 b. 3,750,000 C. 6,000,000 d. 7,200,000 888

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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Problem 8-5 (with solution/explanation)
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Required Information [The following information applies to the questions displayed below] Timberly Construction makes a lump-sum purchase of several assets on January 1 at a total cash price of $830,000. The estimated market values of the purchased assets are building, $467,500, land, $243,100; land improvements, $56,100; and four vehicles, $168,300. Required: 1-a. Allocate the lump-sum purchase price to the separate assets purchased. 1-b. Prepare the journal entry to record the purchase. 2. Compute the first-year depreciation expense on the building using the straight-line method, assuming a 15-year life and a $29,000 salvage value. 3. Compute the first-year depreciation expense on the land improvements assuming a five-year life and double-declining-balance depreciation. Complete this question by entering your answers in the tabs below. Required 3 Allocate the lump-sum purchase price to the separate assets purchased. Required 1A Required 18 Required 2 Allocation of total cost Building…