Simpson and Homer Corporation acquired an office building on three acres of land for a lump-sum price of $2,300,000. The building was completely furnished. (This was the purchase of a building and related property, not the purchase of a business.)
According to independent appraisals, the fair values of the acquired assets were:
$1,300,000-building
$780,000-land
$520,000-furniture
The cost recorded in the general ledger for the building, land, and furniture and fixtures would be:
a. $1,300,000 building; $780,000 land; $520,000 furniture
b. $2,300,000 building
c. $1,150,000 building; $690,000 land; $460,000 furniture
d. $1,200,000 building; $720,000 land; $480,000 furniture
e. $1,200,000 building; $680,000 land; $420,000 furniture