Question

e Cambridge Business Publishee Accounting for Long-Lived and Intangible Assets Chapter 9 PROBLEMS-SET A P9-1A. Acquisition Cost of Long-Lived Assets The following items represent expenditures (or receipts) LO1 related to the construction of a new home office for Norma Company. Cost of land site, which included an old apartment building appraised at $75,000 Legal fees, including fee for title search. .. Payment of apartment building mortgage and related interest due at time of sale Payment for delinquent property taxes assumed by the purchaser. .. Cost of razing the apartment building.. Proceeds from sale of salvaged materials Grading to establish proper drainage flow on land site Architect's fees on new building.. . Proceeds from sales of excess dirt (from basement excavation) to owner of adjoining property (dirt was used to fill in a low area on property).. Payment to building contractor.... . Payment of medical bills of employee accidentally injured while inspecting building construction. . $ 180,000 2,100 9,300 6,000 19,000 (3,800) 2,100 310,000 (2,000) 5,000,000 1,600 20,000 30,000 9,500 7,800 10,000 Special assessment for paving city sidewalks (paid to city) Cost of paving driveway and parking lot.. Cost of installing lights in parking lot. .. Premium for insurance on building during construction Cost of open house party to celebrate opening of new building. Required From the given data, calculate the proper balances for the Land, Building, and Land Improvements accounts of Norma Company. P9-2A. Allocation of Package Purchase Price and Depreciation Methods To expand its business, Renee Company naid $760.000 for most of the pronertyv plant and equipment of a emall trcking.company

Answer 1

calulation of Land balance:

cost of land site	180,000
legal fees	2100
payment of building mortgagel	9300
payment for delinquent property taxes	6000
cost of razing apartment building	19,000
grading to establish proper drainage	2100
special assessment for paving city sidewalks	20,000
less:proceeds from sale of salvaged materials	(3,800)
cost of land	234,700

building:

architect fees	310,000
payment to building contractor	5,000,000
premium of insurance	7800
less: proceeds from sale of dirt	(2000)
cost of building	5,315,800

land improvements:

cost of paving drive way and parking lor	30,000
cost of installing lights in parking lot	9,500
land improvements	39,500

Rest of the amounts are written off as expenses.