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What is the initial cost of the investment property

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Reference no: EM132623833

Question - On January 1, 2014. Versatile Company acquired a building for P10,450,000 including P500,000 nonrefundable purchase taxes. The purchase agreement provided for payment to be made in full on December 31, 2014. Legal fees of P220,000 were incurred in acquiring the building and paid on January 1, 2014. The building is held to earn lease rentals and for capital appreciation. An appropriate discount rate is 10%.

Required - What is the initial cost of the investment property?

A. 9,500,000

C. 9,720,000

B. 9,700,000

D. 10,170,000

Reference no: EM132623833

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