Question

At December 31, 2019, certain accounts included in the property, plant, and equipment section of Blossom Company's balance sheet had the following balances. Land Buildings Leasehold improvements Equipment $238,200 905,200 661,900 883,800 During 2020, the following transactions occurred. 1. Land site number 621 was acquired for $850,800. In addition, to acquire the land Blossom paid a $53,000 commission to a real estate agent. Costs of $36,200 were incurred to clear the land. During the course of clearing the land, timber and gravel were recovered and sold for $20,400. 2. A second tract of land (site number 622) with a building was acquired for $417,500. The closing statement indicated that the land value was $297,500 and the building value was $120,000. Shortly after acquisition, the building was demolished at a cost of $41,000. A new building was constructed for $331,400 plus the following costs. Excavation fees Architectural design fees Building permit fee Imputed interest on funds used during construction (stock financing) $37,700 11,100 2.500 8,600 The building was completed and occupied on September 30, 2020. 3. A third tract of land (site number 623) was acquired for $650,800 and was put on the market for resale. 4. During December 2020, costs of $89,300 were incurred to improve leased office space. The related lease will terminate on December 31, 2022, 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 payment of royalties based on units of production for the machines. The invoice price of the machines was $86,200, freight costs were $3,300, installation costs were $2,300, and royalty payments for 2020 were $17,600. (a) Calculate the balance at December 31, 2020 in each of the following balance sheet accounts. Disregard the related accumulated depreciation accounts. Balance at December 31, 2020 Land A Buildings A Leasehold Improvements A Equipment A

Answer 1

Calculate the balance of land as follows:

$+eAAyoLHwmuQAAAABJRU5ErkJggg==$

Calculate the balance of building as follows:

$2Q==$

Calculate the balance of leasehold as follows:

$9k=$

Calculate the balance of equipment as follows:

$QourEXYO33EAAAAASUVORK5CYII=$