Question

A building with an appraisal value of $136,787 is made available at an offer price of $157,859. The purchaser acquires the property for $34,148 in cash, a 90-day note payable for $27,610, and a mortgage amounting to $58,126. The cost basis recorded in the buyer's accounting records to recognize this purchase is

Answer 1

the cost basis recorded to recognize this purchase is $119,884

Step-by-step explanation:

The computation of the cost basis recorded to recognize this purchase is shown below:

= Acquired property in cash + note payable + mortgage

= $34,148 + $27,610 + $58,126

= $119,884

Hence, the cost basis recorded to recognize this purchase is $119,884