Question
Carrot Company purchased land, land improvements and building from Sili Company for P19,000,000 and furniture and equipment from Sinigang Company for P16,000,000. The total cash
Carrot Company purchased land, land improvements and building from Sili Company for P19,000,000 and furniture and equipment from Sinigang Company for P16,000,000. The total cash outlay for the two transactions amounted to P35,000,000. The appraised value of the assets are: Building -P13,000,000; Furniture -P9,000,000; Equipment- P6,000,000; Land- P18,000,000; and Land Improvements- P2,500,000. The company paid appraisal cost for the land, land improvement and building of P10,000 and for the furniture and equipment of P2,000.
Determine the cost to be allocated to the land, land improvements, building, furniture and equipment.
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