Pitney Co. purchased an office building, land, and furniture for $692,200 cash. The appraised value of the assets was as...
Pitney Co. purchased an office building, land, and furniture for $692,200 cash. The appraised value of the assets was as follows: Land $ 131,795 Building 240,332 Furniture 403,137 Total $ 775,264
Required
-
Compute the amount to be recorded on the books for each asset.
-
Record the purchase in a horizontal statements model.
Homework Answers
| a | |||||||||
| Allocated cost | |||||||||
| Land | 117674 | =692200*131795/775264 | |||||||
| Building | 214582 | =692200*240332/775264 | |||||||
| Furniture | 359944 | =692200*403137/775264 | |||||||
| Total | 692200 | ||||||||
| b | |||||||||
| Assets | Equity | Revenue | Expense | Net income | Cash flows | ||||
| Cash | Land | Building | Furniture | ||||||
| -692200 | 117674 | 214582 | 359944 | -692200 | IA | ||||
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