Question

During the year, a wealthy local merchant donated a building to the city of Rosewood. The original cost of the building was $300,000. Accumulated depreciation at the date of the gift amounted to $250,000. The acquisition value of the donation at the date of the gift was $600,000. At what amount should Rosewood record this donated property in the General Fund?

a. $300,000

b. $350,000

c. $600,000

d. $250,000

Answer 1

The donated property should be recorded in the General Fund at the acquisition value of $600,000.

Step-by-step explanation:

The donated property should be recorded in the General Fund at the acquisition value of the donation, which is $600,000. This is because the original cost of the building and the accumulated depreciation are not relevant in this case.