Baxter Ltd acquired a parcel of land, buildings and machinery on 10 July for a cash price

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Baxter Ltd acquired a parcel of land, buildings and machinery on 10 July for a cash price of $2 400 000. Fair values of the assets on the acquisition date were appraised as:

Land

Building

Machinery

1 400 000

800 000

150 000

2 350 000

The acquisition was not considered to be a business combination.

Required

Calculate the amount of cost that should be assigned to each of the assets and prepare a journal entry to record the acquisition. Ignore GST.

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Related Book For answer-question

Accounting

ISBN: 978-1118608227

9th edition

Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett

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Question Posted: Jun 25, 2019 05:15 AM

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Baxter Ltd acquired a parcel of land, buildings and machinery on 10 July for a cash price

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Asset type Fair value Proportion of total value Allocation o...View the full answer

Accounting

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