A Real Estate Management Company Buys an Apartment Complex for $4.8

Multiple Choice

A real estate management company buys an apartment complex for $4.8 million.An appraiser values the land at $1.1 million,the building at $3.4 million,and the equipment at $0.3 million.In addition,the company pays a 5% commission to a broker for arranging the sale.Which of the following statements is true?

A) The company would record $3.57 million as the acquisition cost of the building.
B) The company would record $1.1 million as the acquisition cost of the land.
C) The company would record $3.7 million as the acquisition cost of the building.
D) The company would record $0.24 million as an expense and $4.8 million as an asset.