Question

Rangers, Inc. purchased land, buildings and equipment at a lump-sum price of $1,000,000. An appraisal of the assets at the time of acquisition disclosed the following values: Asset Cost Assigned to Asset Appraised Value $240,000 Land Buildings 600,000 Equipment 360,000 Provide the cost assigned to each asset in the space provided.

Answer 1

Assets	Appraised value	Cost assigned to assets
Land	$               240,000	$   200,000
Building	$               600,000	$   500,000
Equipment	$               360,000	$   300,000

Calculation

Assets	Appraised value	Numerator	Denominator	Weight
Land	$               240,000	$   240,000	$    1,200,000	20%
Building	$               600,000	$   600,000	$    1,200,000	50%
Equipment	$               360,000	$   360,000	$    1,200,000	30%
Total	$            1,200,000
Assets	Lum-sum Price	Multiply: Weight	Cost assigned to assets
Land	$            1,000,000	20%	$        200,000
Building	$            1,000,000	50%	$        500,000
Equipment	$            1,000,000	30%	$        300,000