. What amount should be reported as cost of land? 2. What amount should be reported as cost of building?
. What amount should be reported as cost of land? 2. What amount should be reported as cost of building?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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During the current year, Bear Company had the following transactions pertaining to a new office building:
Purchase price of land- 600,000
Legal fees for contract to purchase land- 20,000
Architect fee -80,000
Demolition of old building on site to make room
for construction of new building -50,000
Sale of scrap from old building -30,000
Construction cost of new building fully completed -3,500,000
1. What amount should be reported as cost of land?
2. What amount should be reported as cost of building?
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