(b) The following costs were incurred in 2016 in the design and construction of a new office building over a nine-month period during 2016: GH Feasibility study Architects' fees . . . . . . Site clearance (by external demolition professionals). Construction materials Cost of own inventories used in the construction (net realizable value if sold outside the company GHe24,000) Internal construction staff salaries during period of construction- External contractor costs Income from renting out part of site as storage depot during early phase of construction (12) 10,000 5,000 70,000 5,000 30,000 3,600 340,000 300,000 Required: In accordance with IAS 16 Property, plant and equipment, calculate the amount that should be capitalised as property in the financial statements for the year ending 31 December 2016.

(b) The following costs were incurred in 2016 in the design and construction of a new office building over a nine-month period during 2016: GH Feasibility study Architects' fees . . . . . . Site clearance (by external demolition professionals). Construction materials Cost of own inventories used in the construction (net realizable value if sold outside the company GHe24,000) Internal construction staff salaries during period of construction- External contractor costs Income from renting out part of site as storage depot during early phase of construction (12) 10,000 5,000 70,000 5,000 30,000 3,600 340,000 300,000 Required: In accordance with IAS 16 Property, plant and equipment, calculate the amount that should be capitalised as property in the financial statements for the year ending 31 December 2016.

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

Chapter12: Intangibles

Section: Chapter Questions

Problem 7RE

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