A company purchased land for $92,000 cash. The real estate brokers' commission was $7,500 and $8,000 was spent for demolishing an old building on the land before construction of a new building could start. Proceeds from the salvage of the demolished building were $1,500. Under the cost principle, what would the cost of the land be recorded as?

A company purchased land for $92,000 cash. The real estate brokers' commission was $7,500 and $8,000 was spent for demolishing an old building on the land before construction of a new building could start. Proceeds from the salvage of the demolished building were $1,500. Under the cost principle, what would the cost of the land be recorded as?

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter10: Property, Plant And Equipment: Acquisition And Subsequent Investments

Section: Chapter Questions

Problem 3RE: Utica Corporation paid 360,000 to purchase land and a building. An appraisal showed that the land is...

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Utica Corporation paid 360,000 to purchase land and a building. An appraisal showed that the land is worth 100,000 and the building is worth 300,000. What cost should Utica assign to the land and to the building, respectively?
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