Al Madinah Co. purchases land for RO 90,000 cash. The company paid RO 11,600 in property taxes. The title and attorney fees were RO 6,000. The land was cleared for RO 7,100. The cost of land would be recorded at

Al Madinah Co. purchases land for RO 90,000 cash. The company paid RO 11,600 in property taxes. The title and attorney fees were RO 6,000. The land was cleared for RO 7,100. The cost of land would be recorded at

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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A company purchased new equipment for $62,000. The company paid cash for the equipment. Other costs associated with the equipment were: transportation costs, $1,100; sales tax paid $3,400; and installation cost, $2,700. The cost recorded for the equipment was: Multiple Cholce $69,200. $66,500. $62,000. $63,100.
Northwest Delivery Company acquired an adjacent lot to construct a new warehouse, paying $75,000 and giving a short-term note for $90,000. Legal fees paid were $2,500, delinquent taxes assumed were $22,400, and fees paid to remove an old building from the land were $14,500. Materials salvaged from the demolition of the building were sold for $7,500. A contractor was paid $660,000 to construct a new warehouse. Determine the Cost of the land to be reported on the balance sheet.
Daly Publishing Corporation recently purchased a truck for $43,000. Under MACRS, the first year's depreciation was $8,600. The truck driver's salary in the first year of operation was $61,800. The company's tax rate is 30 percent. Required: 1-a. Calculate the after-tax cash outflow for the acquisition cost and the salary expense. 1-b. Calculate the reduced cash outflow for taxes in the first year due to the depreciation. Complete this question by entering your answers in the tabs below. Req 1A Req 1B Calculate the after-tax cash outflow for the acquisition cost and the salary expense. After-Tax Cash Outflow Acquisition cost Salary expense
Robertson Company exchanged a machine for some land. The machine had cost $17,000, was 70% depreciated, and could be sold for $4,500. Robertson paid $950 in addition to giving up the machine. compute the amount at which the land should be recorded.
On December 1, 20X0, AKE Pte Ltd paid $5,000 to a Real Estate consulting company for a market report of the property market. The market survey was favourable and AKE Pte Ltd decided to make an entry into the property market. On January 1, 20X1 the company purchased two buildings paying $800,000 for Building X and $1,200,000 for Building Y. The company paid $20,000 to the property agent and incurred an additional $80,000 legal fee to finalise the transaction. Both buildings have useful life of 40 years and zero residual value. The company uses straight- line method for depreciation of all its non-current assets. The company intends to use Building X as their office and rent out Building Y. The company adopts revaluation model for its PPE and fair value model for its investment property. Any accumulated depreciation at the date of the revaluation will be eliminated against the gross carrying amount of the asset. At the end of the year 20X1, values of the two buildings were as below:…
teele Corp. purchases equipment for $25,000. Regarding the purchase, Steele recorded the following transactions: • Paid shipping of $1,000• Paid installation fees of $2,000• Pays annual maintenance cost of $200• Received a 5% discount on $25,000 sales price Determine the acquisition cost of the equipment.
Amos, Inc. puchased land for $55,000 cash. They also incurred commissions of $ 1,650, property taxes of $6,000, and title insurance of $500. The $6,000 in property taxes includes $4,000 in back taxes paid by Amos, Inc. on behalf of the seller and $ 2,000 due for the current year after the purchase date. Amos also paid a contractor $ 10,000 to tear down a dilapidated building on the property. The capitalized cos of the land is: A. $61, 150 B. $73, 150 C.$ 71, 150 D. $70,650
HP Company purchased equipment on January 1 at a list price of $127,000, with credit terms 2/10, n/30. Payment was made within the discount period and Yocum was given a $21,400 cash discount. Yocum paid $6,000 sales tax on the equipment, and paid installation charges of $11,760. Prior to installation, Yocum paid $4,000 to pour a concrete slab on which to place the equipment. What is the total cost of the new equipment? Select one: a. $123,600 b. $125,360 C. $131,760 d. $129,36 e. The answer does not exist Previous page Next page
Steele Corp. purchases equipment for $20,000. Regarding the purchase, Steele recorded the following transactions: • Paid shipping of $800. • Paid installation fees of $1,600. Pays annual maintenance cost of $240. • Received a 5% discount on $20,000 sales price. Determine the acquisition cost of the equipment.
Donner Company is selling a piece of land adjacent to its business premises. An appraisal reported the market value of the land to be $221,567. Focus Company initially offered to buy the land for $181,076. The companies settled on a purchase price of $209,946. On the same day, another piece of land on the same block sold for $231,997. Under the cost concept, at what amount should the land be recorded in the accounting records of Focus Company? Oa. $221,567 Ob. $231,997 Oc. $209,946 Od. $181,076
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?
Corazon Company purchased an asset with a list price of $17,600. Corazon paid $1,400 of transportation-in cost, $1,700 to train an employee to operate the equipment, and $1,100 to insure the asset against theft after it has been set up in the factory. The asset was purchased under terms 1/20, n/30 and Corazon paid for the asset within the discount period. Based on this information, Corazon would capitalize the asset on its books at: Multiple Choice O O O $19,124. $17,600. $19,300. $20,524.