Question

I need some help please

P10-1 (Classification of Acquisition and Other Asset Costs) At December 31, 2011, certain accounts included in the property, plant, and equipment section of Reagan Company's balance sheet had the Land $890,000 $660,000 Leasehold improvements During 2014 the following transactions occurresd 1 Land site number 62 1 was acquired for「S850000コIn addition, toi quire the land Reagan paid a $35,000 were incurred $51,000commission to a real estate agent. Costs of to clear the land. During the course of clearing the land, timber and gravel were recovered and sold for $13,000 2. A second tract of land (site number 622) with a building was acquired for The closing statement indicated that the land value was $300,000 and the building alue was $41,000 $120.000 Shortly after acquisition, the building was demolished at a cost o! A new building was constructed for costs Excavation fees Architectural design fees 38,000 $11,000 500 Imputed interest on funds used during construction (Stock financing 500 The building was completed and occupied on September 30 2014 3. A third tract of land (site number 623) was acquired for 650,000and was put on the market for resale 4. During December 2014, costs of $89000 were incurred to improve leased office space The related lease will terminate on December 31, 2016, and is not expected to be renewed (Hint: Leasehold improvements should be handled in the same manner as land improvements.) 5. A group of new machines was purchased under a royalty agreement that provides for royalties based on units of production for the machines The invoice price of the machines was nstallation costs were$2400 $87.000freight costs were and royalty payments for 2014 were $3,300 $17,500 Instructions: (a) Prepare a detailed analysis of the changes in each of the following balance sheet accounts for 2014 Leasehold Improvements Land Disregard the related accumulated depreciation accounts

Answer 1

a)

REAGAN COMPANY
Analysis of Land Account for 2014
Balance, January 1, 2014			$      230,000.00
Land site number 621
Acquisition Cost		$ 850,000.00
Commission paid for real estate		$    51,000.00
Clearing Land	$   35,000.00
Less: Amount Recovered	$ (13,000.00)	$    22,000.00
Total land site number 621			$      923,000.00
Land site number 622
Land Value		$ 300,000.00
Building Value		$ 120,000.00
Demolition Cost		$    41,000.00
Total land site number 622			$      461,000.00
Balance at December 31, 2014			$ 1,614,000.00

REAGAN COMPANY
Analysis of Building Account for 2014
Balance, January 1, 2014			$      890,000.00
Cost of new building constructed on land site number 622
Construction Costs		$ 330,000.00
Excavation fees		$    38,000.00
Architectural design fees		$    11,000.00
Building permit fee		$      2,500.00	$      381,500.00
Total			$ 1,271,500.00

REAGAN COMPANY
Analysis of Leasehold Account for 2014
Balance, January 1, 2014			$      660,000.00
Office Space			$        89,000.00
Balance at December 31, 2014			$      749,000.00

REAGAN COMPANY
Analysis of Machinery & Equipment Account for 2014
Balance, January 1, 2014			$      875,000.00
Cost of the new machines acquired
Invoice Price		$    87,000.00
Freight Costs		$      3,300.00
Installation Costs		$      2,400.00	$        92,700.00
Balance at December 31, 2014			$      967,700.00