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Mathematics, 05.11.2020 22:00 peteh5
Accounting 1 question
Western Bank & Trust purchased land and a building for the lump sum of $3 million dollars. To get the maximum tax deduction, Western allocated 90% of the purchase price to the building and only 10% to the land. A more realistic allocation would have been 70% to the building and 30% to the land.
Explain the tax advantage of allocating too much to the building and too little to the land.
Was Western's allocation ethical? If so, state why. If not, state why not. Identify who was harmed.
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