Costs of Group Purchases

• Is a lump sum purchase of land and other assets.

• Requires apportionment of the purchase price to Land and other asset accounts.

• Land must have a separate ledger account because it is nondepreciable.

  Appraisal Percentage Apportionment
  

Land $ 10,000 10 $ 8,500

Building 90,000 90 76,500

Totals $100,000 100 $85,000

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