Problem

Fisk Manufacturing purchases a large lot on which an old building is located as part of...

Fisk Manufacturing purchases a large lot on which an old building is located as part of its plans to build

a new plant. The negotiated purchase price is $209,000 for the lot plus $104,000 for the old building.

The company pays $40,400 to tear down the old building and $59,722 to fill and level the lot. It also

pays a total of $1,663,150 in construction costs—this amount consists of $1,564,400 for the new building

and $98,750 for lighting and paving a parking area next to the building. Prepare a single journal entry

to record these costs incurred by Fisk, all of which are paid in cash.

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