Chico Company paid $580,000 for a basket purchase that included office furniture, a building and land. An appraiser provided the following estimates of the market values of the assets if they had been purchased separately: Office furniture – $150,000; Building – $480,000, Land – $120,000. Based on this information, and rounding allocations to two decimal places, the amount of cost that would be allocated to the office furniture is closest to: (Round your intermediate percentages to 2 decimal places: ie 0.054231 = 5.42%.):

$116,000

Explanation:

The computation of the allocated cost of the land is shown below:

= Purchase value of property × office appraised value ÷ Total appraisal value

= $580,000 × $150,000 ÷ $750,000

= $116,000

The total appraisal value would be

= Appraisal value of office furniture + appraisal value of building + appraisal value of land

= $150,000 + $480,000 + $120,000

= $750,000

the answer is "b.the increased supply will create a surplus. "

the essential thought behind price controls is straightforward - utilize the power of law to modify the equilibrium of a market. for instance, the legislature may choose that the steel business needs to survive, and in this way pass a law to set a value floor on steel. this implies all steel sold must offer at or over the floor value, which must be set over the equilibrium cost for it to have any impact. the switch could likewise happen - the administration can choose that steel is excessively costly and set a value roof underneath its equilibrium value, with the goal that all steel must be sold at or beneath that ceiling.