Question

What is the Journal entry for : Bought a piece of land at a cost of 9000, registration charges incurred of 50000 Please please please answer it fast it's urgent

Answer 1

Answer:

Sometimes a company buys land and other assets for a lump sum. When land and buildings purchased together are to be used, the firm divides the total cost and establishes separate ledger accounts for land and for buildings. This division of cost establishes the proper balances in the appropriate accounts. This is especially important later because the depreciation recorded on the buildings affects reported income, while no depreciation is taken on the land.

Let’s look at an example: Assume a company purchases land, machinery and a building for $4,000,000 cash. The land has a market value of $1,350,000, machinery of $675,000 and the building for $2,475,000 for a total value of $4,500,000. We cannot report the assets at market value since the market value is less than we paid for the assets. We will do a 2-step process to get the cost of each asset.

Answer 2

Answer:

entry will be

land a/c. dr. 59,000

to cash/bank a/c