Question

Application Problem 8-2B a1 Nordso Ltd. purchased a new warehouse. The warehouse had been listed for sale for $5,380,000, but Nordso was able to acquire it for $5,230,000. The bank, which was providing Nordso with the financing for the purchase, required that an appraisal be completed of the property. The appraisal report came back with the following estimated market values: land $1,740,840, building $2,728,740, and land improvements $870,420. (21) Allocate the purchase price to the land, building, and land improvements. (Round allocation percentage to 1 decimal place, e.g. 15.2% and final answers to 0 decimal places, e.g. 125.) Allocated Cost ___ Land Building ी ी Land Improvements

ANSWER WITH FULL STEPS ( URGENT)

Answer 1

Total appraised cost = 1740840+2728740+870420 = 5340000

Allocated cost

	Allocated cost
Land	5230000/5340000*1740840 = 1704980
Building	5230000/5340000*2728740 = 2672530
Land improvement	852490