Cost Concept On February 22, Kountry Repair Service extended an offer of $200,00
ID: 2604635 • Letter: C
Question
Cost Concept
On February 22, Kountry Repair Service extended an offer of $200,000 for land that had been priced for sale at $250,000. On April 3, Kountry Repair Service accepted the seller’s counteroffer of $230,000. On September 15, the land was assessed at a value of $185,000 for property tax purposes. On January 9 of the next year, Kountry Repair Service was offered $300,000 for the land by a national retail chain.
At what value should the land be recorded in Kountry Repair Service’s records?
$
Explanation / Answer
Answer = $230,000
As according to the cost concept Asset should be recorded at Cost to Kountry Repair Service and they accepted $230,000 (Seller's counteroffer), So the asset should be recorded at $230,000