Cala Manufacturing purchases land for $381,000 as part of its plans to build a new plant. The company pays $26,000 to tear down an old building on the lot and $38,435 to fill and level the lot. It also pays construction costs $1,264,800 for the new building and $79,838 for lighting and paving a parking area. Prepare a single journal entry to record these costs incurred by Cala, all of which are paid in cash. View transaction list Journal entry worksheet

Cala Manufacturing purchases land for $381,000 as part of its plans to build a new plant. The company pays $26,000 to tear down an old building on the lot and $38,435 to fill and level the lot. It also pays construction costs $1,264,800 for the new building and $79,838 for lighting and paving a parking area. Prepare a single journal entry to record these costs incurred by Cala, all of which are paid in cash. View transaction list Journal entry worksheet

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

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
Apple Co. purchased land as a factory site for $1,350,000. Apple paid $120,000 to tear down two buildings on the land. Salvage was sold for $8,100. Legal fees of $5,220 were paid for title investigation and making the purchase. Architect's fees were $46,800. Title insurance cost $3,600, and liability insurance during construction cost $3,900. Excavation cost $15,660. The contractor was paid $4,200,000. An assessment made by the city for pavement was $11,600. Interest costs during construction were $255,000. The cost of the land that should be recorded by Apple Co. is
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?
On January 6, Year 1, Mount Jackson Corporation purchased a tract of land for a factory site for $825,000. An existing building on the site was demolished and the new factory was completed on October 11, Year 1. Additional cost data are shown below: Construction cost of new building $ 1,000,000 Real estate and attorney fees 18,200 Architect fees 84,000 Cost to demolish old building 77,100 Salvage recovery from old building (13,000 ) Which of the following are the capitalized costs of the land and the new building, respectively? Multiple Choice A $843,200 and $1,148,100 B $920,300 and $1,071,000 C $825,000 and $1,166,300 D $907,300 and $1,084,000
During 2001, Daisy Co. incurred P 1,500,000 in direct materials, P 1,200,000 in direct labor, and P 1,000,000 in overhead in the self-constructed building to be held as an investment property. The building was completed on December 31, 2001. The fair value of the building on December 31, 2001, is P 4,000,000. Prepare all the necessary journal entries in 2001.
Kegler Bowling buys scorekeeping equipment with an invoice cost of $190,000. The electrical work required for the installation costs $20,000. Additional costs are $4,000 for delivery and $13,700 for sales tax. During the installation, the equipment was damaged and the cost of repair was $1,850. What is the total recorded cost of the scorekeeping equipment?
The Madison Sign Company purchased land as a factory site for $75,000. Prior to construction of the new building, the land had to be cleared of trees and brushConstruction costs incurred during the first year are listed below
Raymond Stamping Services purchased a stamping machine priced at $21,500. The firm had to pay a sales tax of $1,200 on this purchase. Raymond also paid the inbound transportation charges of $525 on the new machine, as well as a labor cost of $1,350 to install the machine in the factory. In addition, Raymond had to prepare the site before installation at a cost of $2,125. Determine the cost basis for the new machine for depreciation purposes.
Rex's Reclaimers entered into a contract with Dan's Demolition to manage the processing of recycled materials on Dan's various demolition projects. Services for the 3-year contract include collecting, sorting, and transporting reclaimed materials to recycling centers or contractors who will reuse them. Rex's incurs selling commission costs of $2,000 to obtain the contract. Before performing the services, Rex's also designs and builds receptacles and loading equipment that interfaces with Dan's demolition equipment at a cost of $27,000. These receptacles and equipment are retained by Rex's and can be used for other projects. Dan's promises to pay a fixed fee of $12,000 per year, payable every 6 months for the services under the contract. Rex's incurs the following costs: design services for the receptacles to interface with Dan's equipment $3,000, loading equipment controllers $6,000, and special testing and OSHA inspection fees $2,000 (some of Dan's projects are on government…