Exercise 8-5A Allocating costs on the basis of relative market values LO 8-1 Carver Inc. purchased a building and the land on which the building is situated for a total cost of $700,000 cash. The land was appraised at $320,000 and the building at $480,000. Required a. What is the accounting term for this type of acquisition? b. Determine the amount of the purchase cost to allocate to the land and the amount to allocate to the building. c. Would the company recognize a gain on the purchase? d. Record the purchase in a statements model. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D What is the accounting term for this type of acquisition? Type of acquisition as per accounting Required A Required B > Hel Exercise 8-5A Allocating costs on the basis of relative market values LO 8-1 Carver Inc. purchased a building and the land on which the building is situated for a total cost of $700,000 cash. The land was appraised at $320,000 and the building at $480,000 Required a. What is the accounting term for this type of acquisition? b. Determine the amount of the purchase cost to allocate to the land and the amount to allocate to the building. c. Would the company recognize a gain on the purchase? d. Record the purchase in a statements model. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required D Determine the amount of the purchase cost to allocate to the land and the amount to allocate to the building, Allocated Cost Land Building Total Exercise 8-5A Allocating costs on the basis of relative market values LO 8-1 Carver Inc. purchased a building and the land on which the building is situated for a total cost of $700,000 cash. The land was appraised at $320,000 and the building at $480,000. Required a. What is the accounting term for this type of acquisition? b. Determine the amount of the purchase cost to allocate to the land and the amount to allocate to the building. c. Would the company recognize a gain on the purchase? d. Record the purchase in a statements model. Complete this question by entering your answers in the tabs below. Required A Required B Required C Required Required D Record the purchase in a statements model like the following one. (In the Cash Flow column, use the initials OA to designate operating activity, IA for in for net change in cash and NA for not affected. Enter any decreases to account balances with a minus sign.) CARVER INC Statements Model Balance Sheet Income Statement - Expenses - Net Income Liabilities - Equity Revenue Statement of Cash - = Flows Cash + Land + Bldg.