Question

Flint Supply Company, a newly formed corporation, incurred the following expenditures related to Land, to Buildings, and to Machinery and Equipment. Abstract company’s fee for title search $1,118 Architect’s fees 6,816 Cash paid for land and dilapidated building thereon 187,050 Removal of old building $43,000 Less: Salvage 11,825 31,175 Interest on short-term loans during construction 15,910 Excavation before construction for basement 40,850 Machinery purchased (subject to 2% cash discount, which was not taken) 118,250 Freight on machinery purchased 2,881 Storage charges on machinery, necessitated by noncompletion of building when machinery was delivered 4,687 New building constructed (building construction took 6 months from date of purchase of land and old building) 1,042,750 Assessment by city for drainage project 3,440 Hauling charges for delivery of machinery from storage to new building 1,333 Installation of machinery 4,300 Trees, shrubs, and other landscaping after completion of building (permanent in nature) 11,610 Determine the amounts that should be debited to Land, to Buildings, and to Machinery and Equipment. Assume the benefits of capitalizing interest during construction exceed the cost of implementation. Company uses net method to record discount. (Please leave spaces blank if there is no answer. Do not enter zeros in those spaces.)

Answer 1

Answer PINI O Page No 0 The company uses net method to record discount. Land Building Machinery and Il equipment 1 others Ababaiat fees for lille search $1118 Architect fees. $ 6816 cash paid for land and $187,050 old building Removal of old building $31,145 interest on loans during construction $ 15,910 Excavation before Consku sction for pavement $ 40,850 Machinery purchased 118250-2365 118250X2%. subject to .), discount $115885 $ 2365 which was not taken freight on machinery $2881 pwichard Stowage changes on machi $4687 -nery necessitated non- completion of machinery tos

Page No ③ $1042750 New building constructed Assessment by cilj Fox $ 3440 drainage Hauling charges for $ 1333 delivery of machinery Insfallahion machinery $ 4300 Trees, shados en landsca ping of abter completio $11610 En of building $234393 $1106326 $123066 $8385