This is a bargain purchase the sales price is less than the

Reference no: EM13599265

Wanting to finalize a sale before year-end, on December 29, WR Outfitters sold to Bob a warehouse and the land for $219,000. The appraised fair market value of the warehouse was $127,500, and the appraised value of the land was $185,750.

NOTE: This is a bargain purchase. The sales price is less than the appraised value. This solution uses the relative appraised values of the land and the warehouse to allocate the purchase price between these two assets.

A. What is Bob's basis in the warehouse and in the land?

Reference no: EM13599265

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