The city of Allentown recently received a donation of two items. A letter written in 1820 from James Allen, the town's founder, in which he set forth his plans for the town's development. Independent appraisals have value do better at $24,000. In 1920 painting of the town City Hall. Comparable paintings by the same artist have recently been purchased for $4000. The town intended to place the letter on public display in at City Hall. He plans to sell the painting, Using the proceeds to re-decorate the City Council is meeting chambers. It is the towns policy to capitalize collectibles only when required by GASB standers to do so.

Suppose that the city operated a museum. The museum building, furniture, and fixtures at a cost of $10 million and, on average, were now midway through their useful life. They had a replacement cost of $12 million. The art collection had a market value of $300 million. Consistent with your response to part (a), what value would you place on the art collection? What value would you place on the building, furniture, and fixture? Briefly justify your response, committing pacifically on whether you think the resultant Balance sheet would provide useful information to statement users.