Plant acquisitions for selected companies are as follows: 1 Ivanhoe Industries Inc acquired land, buildings, and equipment from a bankrupt company. Torres Co, for a lump-sum price of $728,000. At the time of purchase, Torres's assets had the following book and appraisal values Book Value Appraisal Value Land Buildings Equipment $193,000 $140,000 245,000 317,000 343,000 343,000 Ivanhoe Industries decided to take the lower of the two values for each asset it acquired. The following entry was made: Land 140,000 Building 245,000 Equipment 343,000 Cash 728,000 2 Ivanhoe Industries expects the building structure to last another 20 years; however, it expects that it will have to replace the roof in the next five years. Torres Indicated that, on Initial construction of the building, the roof amounted to 25% of the cost of the building Because of the unique design and materials needed to replace the roof the contractora stated that the roof structure is currently worth 20% of the value of the building purchase Harl Enterprises purchased equipment by making a $2,000 cash down payment and signing a $26,000, one-year, 11% nots payable. The purchase was recorded as follows: 3. Equipment Cash 30,860 2,000 Notes 26,000 Payable Interest Payable 2,860 Kim Company purchased equipment for $23,800, terma 3/10, n/30. Because the company intended to take the discount, It made no entry until it paid for the acquisition. The entry was Equipment 21,800 Cash 23,086 Purchase Discounts 714 4. Kalser Inc. recently received land at zero cost from the Village of Chester as an inducement to locate its business in the village. The land's appraised value was $33,400. The company made no entry to record the land because it had no cost basis. 5. Zimmerman Company built a warehouse for $621,000. It could have contracted out and purchased the building for $746,000. The controller made the following entry: Buildings 746,000 Cash 621,000 Sales Revenue 125,000