Ayer Furniture purchased land, paying $85,000 cash and signing a $300,000 note payable. In addition, Ayerpaid delinquent property tax of $3,000, title insurance costing $6,000, and $5,000 to level the land andremove an unwanted building. The company then constructed an office building at a cost of $600,000. It alsopaid $53,000 for a fence around the property, $13,000 for a sign near the entrance, and $10,000 for speciallighting of the grounds.Read the requirements.Requirement 1. Determine the cost of the land, land improvements, and building.The cost of the land isRequirements1. Determine the cost of the land, land improvements, and building.2. Which of these assets will Ayer depreciate?PrintDoneIX

Introduction:- Capitalization costs includes the following as follows under:- Initial testing costs…

Answered: 1. Determine the cost of the land, land…

Business

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1. Determine the cost of the land, land improvements, and building. 2. Which of these assets will Ayer depreciate?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Ayer Furniture purchased land, paying $85,000 cash and signing a $300,000 note payable. In addition, Ayer
paid delinquent property tax of $3,000, title insurance costing $6,000, and $5,000 to level the land and
remove an unwanted building. The company then constructed an office building at a cost of $600,000. It also
paid $53,000 for a fence around the property, $13,000 for a sign near the entrance, and $10,000 for special
lighting of the grounds.
Read the requirements.
Requirement 1. Determine the cost of the land, land improvements, and building.
The cost of the land is
Requirements
1. Determine the cost of the land, land improvements, and building.
2. Which of these assets will Ayer depreciate?
Print
Done
I
X

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