Questions: Question 24 2 pts A building with an appraisal value of 154,000 is made available at an offer price of 172,000. The purchaser acquires the property for 40,000 in cash, a 90-day note payable for 45,000, and a mortgage amounting to 75,000. The cost of the building to be reported on the balance sheet is 154,000 172,000 160,000 120,000

Solution Steps

To determine the cost of the building to be reported on the balance sheet, we need to consider the total amount paid by the purchaser, which includes the cash payment, the note payable, and the mortgage. The appraisal value and the offer price are not relevant for this calculation.

1. Sum the cash payment, the note payable, and the mortgage to find the total cost of the building.

The purchaser makes the following payments for the building:

• Cash payment: \( \$40,000 \)
• Note payable: \( \$45,000 \)
• Mortgage: \( \$75,000 \)

To find the total cost of the building, we sum the cash payment, the note payable, and the mortgage: \[ \text{Total Cost} = 40000 + 45000 + 75000 \]

Calculating the total: \[ \text{Total Cost} = 40000 + 45000 + 75000 = 160000 \]

Final Answer