X purchased land and then erected a building. The following costs incurred were: Purchase price of...
X purchased land and then erected a building. The following costs incurred were:
|
Purchase price of land |
1,000,000 |
|
Resource consent fees |
70,000 |
|
Architects and Engineers fees |
100,000 |
|
Construction of Building |
1,500,000 |
|
Interest costs in relation to the Building (over the period) |
180,000 |
The Building became available for use 3 months into the financial year ended 31 March 2017.
- Calculate Depreciation using the Straight Line Method at 2.5% for this year; there is a nil residual value.
- Calculate depreciation for the year ended 31 March 2018
Homework Answers
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X purchased land and then erected a building. The following
costs incurred were:
Purchase price of...
Exercise 10-1 Acquisition costs; land and building [LO10-1] On March 1, 2018, Beldon Corporation purchased land...
Exercise 10-1 Acquisition costs; land and building [LO10-1] On March 1, 2018, Beldon Corporation purchased land as a factory site for $73,000. An old building on the property was demolished, and construction began on a new building that was completed on December 15, 2018. Costs incurred during this period are listed below: Demolition of old building $ 5,500 Architect’s fees (for new building) 12,000 Legal fees for title investigation of land 2,000 Property taxes on land (for period beginning March...
On February 1, 2016, Jekel & Hyde Inc. purchased land and incurred other costs relative to...
On February 1, 2016, Jekel & Hyde Inc. purchased land and incurred other costs relative to the construction of a new warehouse. The costs related to the purchase of the land and the construction of the building are listed below: Purchase price of the land $231,250 Title insurance for the land $1,500 Legal fees to purchase land $1,000 Cost of razing an old building on the land to be used $8,500 for the construction of the warehouse Delinquent property taxes...
1. Bowie Company made a lump sum purchase of land, building, and equipment. The following were...
1. Bowie Company made a lump sum purchase of land, building, and equipment. The following were the appraised values of each element: PP&E Element Amount Land $10,000 Building 25,000 Equipment 45,000 Bowie paid $70,000 cash for the lump sum purchase. What value should be allocated to the building? (Enter only whole dollar values.) 2. Cambridge Company purchased a truck on January 1, 2018. Cambridge paid $22,000 for the truck. The truck is expected to have a $2,500 residual value and...
On March 1, 2021, Beldon Corporation purchased land as a factory site for $75,000. An old building on the property was demolished, and construction began on a new building that was completed on December 15, 2021. Costs incurred during this period are list
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1. Bowie Company made a lump sum purchase of land, building, and equipment. The following were the appraised values of e...
1. Bowie Company made a lump sum purchase of land, building, and equipment. The following were the appraised values of each element: PP&E Element Amount Land $10,000 Building 25,000 Equipment 45,000 Bowie paid $70,000 cash for the lump sum purchase. What value should be allocated to the building? (Enter only whole dollar values.) 2. Cambridge Company purchased a truck on January 1, 2018. Cambridge paid $22,000 for the truck. The truck is expected to have a $2,500 residual value and...
A company incurred the following costs: Purchase price of land Survey fees Payment for demolition of...
A company incurred the following costs: Purchase price of land Survey fees Payment for demolition of old building on land Back property taxes on land Paving costs for parking lot Fence around perimeter of land Lights in parking lot Signs for new business What is the cost of the land? $290,000 6,000 20,000 3,000 70,000 15,000 90,000 5,000 O A. $316,000 O B. $290,000 O C. $319,000 OD. $389,000
Problem 10-5 On January 1, 2020, Sheridan Corporation purchased for $680,000 a tract of land (site...
Problem 10-5
On January 1, 2020, Sheridan Corporation purchased for $680,000 a
tract of land (site number 101) with a building. Sheridan paid a
real estate broker’s commission of $48,960, legal fees of $8,160,
and title guarantee insurance of $24,480. The closing statement
indicated that the land value was $680,000 and the building value
was $136,000. Shortly after acquisition, the building was razed at
a cost of $73,440.
Sheridan entered into a $4,080,000 fixed-price contract with
Slatkin Builders, Inc. on...
On January 1, 2020, Marin Corporation purchased for $720,000 a tract of land (site number 101)...
On January 1, 2020, Marin Corporation purchased for $720,000 a tract of land (site number 101) with a building. Marin paid a real estate broker's commission of $51,840, legal fees of $8,640, and title guarantee insurance of $25,920. The closing statement indicated that the land value was $720,000 and the building value was $144,000. Shortly after acquisition, the building was razed at a cost of $77,760. Marin entered into a $4,320,000 fixed-price contract with Slatkin Builders, Inc. on March 1,...
Samtech Manufacturing purchased land and building for $4 million. In addition to the purchase price, Samtech made the following expenditures in connection with the purchase of the land and building:
Samtech Manufacturing purchased land and building for $4 million. In addition to the purchase price, Samtech made the following expenditures in connection with the purchase of the land and building: Title insurance$20,000Legal fees for drawing the contract7,000Pro-rated property taxes for the period after acquisition40,000State transfer fees4,400 An independent appraisal estimated the fair values of the land and building, if purchased separately, at $3.2 and $1.8 million, respectively. Shortly after acquisition, Samtech spent $86,000 to construct a parking lot and $44,000 for landscaping. Required:1. Determine...
On January 1, 2020, Marigold Corporation purchased for $680.000 a tract of land (site number 101)...
On January 1, 2020, Marigold Corporation purchased for $680.000 a tract of land (site number 101) with a building Marigold paid a real estate broker's commission of $48,960, legal fees of $8,160, and title guarantee insurance of $24.480. The dosing statement indicated that the land value was $680,000 and the building value was $136,000. Shortly after acquisition, the building was razed at a cost of $73,440. Marigold entered into a $4,080,000 fixed-price contract with Slatkin Builders, Inc. on March 1,...
A company incurred the following costs: Purchase price of land Survey fees Payment for demolition of old building on land Back property taxes on land Paving costs for parking lot Fence around perimeter of land Lights in parking lot Signs for new business What is the cost of the land? $290,000 6,000 20,000 3,000 70,000 15,000 90,000 5,000 O A. $316,000 O B. $290,000 O C. $319,000 OD. $389,000
Problem 10-5
On January 1, 2020, Sheridan Corporation purchased for $680,000 a
tract of land (site number 101) with a building. Sheridan paid a
real estate broker’s commission of $48,960, legal fees of $8,160,
and title guarantee insurance of $24,480. The closing statement
indicated that the land value was $680,000 and the building value
was $136,000. Shortly after acquisition, the building was razed at
a cost of $73,440.
Sheridan entered into a $4,080,000 fixed-price contract with
Slatkin Builders, Inc. on...
On January 1, 2020, Marin Corporation purchased for $720,000 a tract of land (site number 101) with a building. Marin paid a real estate broker's commission of $51,840, legal fees of $8,640, and title guarantee insurance of $25,920. The closing statement indicated that the land value was $720,000 and the building value was $144,000. Shortly after acquisition, the building was razed at a cost of $77,760. Marin entered into a $4,320,000 fixed-price contract with Slatkin Builders, Inc. on March 1,...
On January 1, 2020, Marigold Corporation purchased for $680.000 a tract of land (site number 101) with a building Marigold paid a real estate broker's commission of $48,960, legal fees of $8,160, and title guarantee insurance of $24.480. The dosing statement indicated that the land value was $680,000 and the building value was $136,000. Shortly after acquisition, the building was razed at a cost of $73,440. Marigold entered into a $4,080,000 fixed-price contract with Slatkin Builders, Inc. on March 1,...
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