Merchant Company Purchased Property for a Building Site

Multiple Choice

Merchant Company purchased property for a building site.The costs associated with the property were: What portion of these costs should be allocated to the cost of the land and what portion should be allocated to the cost of the new building?

A) $187,700 to Land; $19,000 to Building.
B) $200,700 to Land; $6,000 to Building.
C) $200,000 to Land; $6,700 to Building.
D) $185,000 to Land; $21,700 to Building.
E) $206,700 to Land; $0 to Building.