On April 1, Sheffield Corp. purchased for $1647000 a tract of land on which a warehouse and office building was located. The following data were collected concerning the property: Current Assessed Valuation Vendor's Original Cost Land $580000 $530000 Warehouse 410000 380000 Office building 810000 680000 $1800000 $1590000 What are the appropriate amounts that Sheffield should record for the land, warehouse, and office building, respectively

The appropriate amounts that Sheffield should record for the land, warehouse, and office building, respectively are given as follows:

Land = $530,700

Warehouse = $375,150

Office building = $741,1500

Explanation:

Note: The data in this question are merged together. They therefore sorted before answering the question as follows:

                     Current Assessed Valuation             Vendor's Original Cost

Land                             $580000                                      $530000

Warehouse                     410000                                        380000

Office building                810000                                       680000

                                   $1800000                                    $1590000

The explanation of the answer is now given as follows:

The appropriate amounts can be determined based on the  Current Assessed Valuation by using the following formula:

Asset amount = (Current Assessed Valuation of the asset / Total Current Assessed Valuation of all the assets) * Purchase price of the tract of land (1)

Using equation (1), we therefore have:

Land = ($580000 / $1800000) * $1647000 = $530,700

Warehouse = ($410000 / $1800000) * $1647000 = $375,150

Office building = ($810000 / $1800000) * $1647000 = $741,1500

Therefore, the appropriate amounts that Sheffield should record for the land, warehouse, and office building, respectively are given as follows:

Land = $530,700

Warehouse = $375,150

Office building = $741,1500