A company paid $150,000, plus a 7% commission and $5,000 in closing costs for a property. The property included land appraised at $87,500, land improvements appraised at $35,000, and a building appraised at $52,500. What should be the allocation of this property's costs in the company's accounting records?
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- A company paid $150,000, plus a 7% commission and $5,000 in closing costs for a property. The property included land appraised at $87,500, land improvements appraised at $35,000, and a building appraised at $52,500. What should be the allocation of this property's costs in the company's accounting records? A. Land $75,000; Land Improvements, $30,000; Building, $45,000. B. Land $75,000; Land Improvements, $30,800; Building, $46,200. C. Land $82,750; Land Improvements, $33,100; Building, $49,650. D. Land $80,250; Land Improvements, $32,100; Building, $48,150. E. Land $77,500; Land Improvements; $31,000; Building; $46,500.28. A company paid $150,000, plus a 6% commission, and $4,000 in closing costs for a property. The property included land appraised at $87,500, land improvements appraised at $35,000, and a building appraised at $52,500. What should be the allocation of this property's costs in the company's accounting records? A. Land $84,100; Land Improvements, $30,000; Building, $48,900B. Land $75,000; Land Improvements, $30,800; Building, $46,200C. Land $81,500; Land Improvements, $32,600; Building, $48,900D. Land $82,700; Land Improvements, $32,600; Building, $47,700On January 1, 2021, EFG Company acquired a building for P1,200,000. Professional fees for legal services and property transfer taxes incurred on the acquisition amounted to P50,000. Start-up costs incurred amounted to P20,000. Operating losses incurred before the planned level of occupancy of the building is achieved amounted to P120,000. Materials labor and overhead incurred for repairs and renovation of the property before it was put to leasable condition amounted to P200,000. Abnormal amounts of wasted material, labor and other resources incurred in developing the property amounted to P60,000. The renovation and repairs were completed on March 31, 2021. The building has an estimated remaining useful life of 10 years with no residual value. EFG Company uses cost model and the straight-line method of depreciation for its investment property. The building has a fair value of P1,400,000 on December 31 ,2021 Required: How much is amount of investment property recognized on…
- Sheridan Company incurs the following costs in purchasing equipment: invoice price, $40,500; shipping, $1,025; installation and testing, $1,600; one-year insurance policy, $2,750.What is the cost of the equipment?A company paid $326,000 for property that included land, land improvements, and a building. The land was appraised at $175,000, the land improvements were appraised at $70,000, and the building was appraised at $105,000. What is the allocation of costs to the three assets? a. Land, $150,000; Land Improvements, $60,000; Building, $90,000 b. Land, $163,000; Land Improvements, $65,200; Building, $97,800 c. Land, $150,000; Land Improvements, $61,600; Building, $92,400 d. Land, $159,000; Land Improvements, $65,200; Building, $95,400 e. Land, $175,000; Land Improvements, $70,000; Building, $105,000Under IFRS 15, assuming the outcome of construction can be estimated reliably, what is the realized gross loss to be recognized by MDC for the year ended December 31, 20x22? On July 1, 20x31, Torela Company, a construction company, entered into a contract to construct a commercial building for a customer on customer-owned land for promised consideration of P1,000,000 and a bonus of P200,000 if the building is completed within 24 months. An inception date, the entity expects total construction costs of P700,000 to complete the building. The entity accounts for the promised bundle of goods and services as a single performance obligation satisfied over time in accordance with paragraph IFRS 15 because the customer controls the building during construction. At contract inception, the entity cannot conclude that it is highly probable that a significant reversal in the amount of cumulative revenue recognized will not occur with respect to inclusion of bonus to contract price. Completion…
- A company purchased a three-acre tract of land for a building site for $380,000. On the land was a building with an appraised value of $122,000. The company demolished the old building at a cost of $11,400, but was able to sell scrap from the building for $1,650. The cost of title insurance was $890 and attorney fees for reviewing the contract were $500. Property taxes paid were $2,200, of which $180 covered the period subsequent to the purchase date. The capitalized cost of the land is:On 1 January 20X7, Z Co purchased an item of plant. The invoice showed: $ Cost of plant 48,000 Delivery to factory 400 One year warranty covering breakdown 800 49,200 Modifications to the factory building costing $2,200 were necessary to enable the plant to be installed. What amount should be capitalised for the plant in Z Co's accounting records? $Midnight, Inc. incurred the following costs related to equipment purchased on January 1, 2022: • Purchased equipment for $80,000, terms 2/ 10, net 30. Paid for the equipment on January 5, 2022. • Had the equipment installed and paid the installer $5,000. • Paid the freight bill for the truck that delivered the equipment for $800. • Advertised a new product that will be produced by the new equipment, $1,900. • Sales taxes paid on the equipment amounted to $6,000. • During installation, a part was broken off and had to be replaced for $2,700. • Midnight believes the machine will be useful for 5 years, at which time it will be sold for $5,000. Assuming Midnight, Inc. uses the straight-line method of depreciation, what will depreciation expense on its 2023 income statement be? Select one: a. $35,330 b. $17,580 c. $19,170 d. $34,720 e. $17,040
- The Thompson Corporation, a manufacturer of steel products, began operations on October 1, 2019. The accounting department of Thompson has started the fixed-asset and depreciation schedule presented below. You have been asked to assist in completing this schedule. In addition to ascertaining that the data already on the schedule are correct, you have obtained the following information from the company's records and personnel: (FV of $1, PV of $1, FVA of $1, PVA of $1, FVAD of $1 and PVAD of $1) (Use appropriate factor(s) from the tables provided.) Depreciation is computed from the first of the month of acquisition to the first of the month of disposition. Land A and Building A were acquired from a predecessor corporation. Thompson paid $792,500 for the land and building together. At the time of acquisition, the land had a fair value of $70,400 and the building had a fair value of $809,600. Land B was acquired on October 2, 2019, in exchange for 2,800 newly issued shares of…In January, 2022, Harmony Inc. has the following expenditures related to manufacturing a new generation of its product. Match each expenditure to the appropriate accounting treatment on the right. Takes possession of a manufacturing machine. The vendor sends an invoice for A. No accounting entry is necessary. B. Capitalize to a different asset account. C. Capitalize to the Machine account. $650,000. D. Expense. Pays a machine import duty of $35,000 to the government. Pays employees $75,000 for research and development to finalize the new product design. Receives an invoice for $4,250 from the company that shipped the machine. Pays employees $16,500 to install, customize, and test the new manufacturing machine. v Pays $1,200 for a one-year insurance policy for the machine, with coverage beginning when the machine is placed into service on February 16.Texas Co. purchased land as a factory site for $1,500,000. Texas paid $200,000 to tear down two buildings on the land. Legal fees of $10,000 were paid for title investigation and making the purchase. Architect's fees were $40,000. Title insurance cost $5,000, and liability insurance during construction cost $4,000. Excavation cost $20,000. The contractor was paid $4,000,000. An assessment made by the city for pavement was $20,000. Interest costs during construction were $200,000. The cost of the land that should be recorded by Texas Co. is?