Question

A building with an appraisal value of $163,000 is made available at an offer price of $181,000. The purchaser acquires the property for $44,000 in cash, a 90-day note payable for $50,000, and a mortgage amounting to $80,000. The cost basis recorded in the buyer's accounting records to recognize this purchase is

Answer 1

the cost basis recorded in the buyer's accounting records to recognize this purchase is $174,000

Step-by-step explanation:

The computation of the cost basis recorded in the buyer's accounting records to recognize this purchase is given below:

Cash paid $44,000

Notes Payable $50,000

Mortgage Payable $80,000

Cost basis recorded $174,000

Hence, the cost basis recorded in the buyer's accounting records to recognize this purchase is $174,000