February 1, 2018, Salisbury Company purchased land for the future factory location at a cost of $82,000. The dilapidated building that was on the property was demolished so that construction could begin on the new factory building. The new factory was completed on November 1, 2018. Costs incurred during this period were: Item Demolition dilapidated building Architect Fees Legal Fees for title search Amount $3,400 $11,250 $1,050 Interest During Active Construction Period $5,025 Real estate transfer tax Construction Costs $1,500 $605,000 Using this information, how much should be recorded as the cost of the land?

February 1, 2018, Salisbury Company purchased land for the future factory location at a cost of $82,000. The dilapidated building that was on the property was demolished so that construction could begin on the new factory building. The new factory was completed on November 1, 2018. Costs incurred during this period were: Item Demolition dilapidated building Architect Fees Legal Fees for title search Amount $3,400 $11,250 $1,050 Interest During Active Construction Period $5,025 Real estate transfer tax Construction Costs $1,500 $605,000 Using this information, how much should be recorded as the cost of the land?

Financial Accounting: The Impact on Decision Makers

10th Edition

ISBN:9781305654174

Author:Gary A. Porter, Curtis L. Norton

Publisher:Gary A. Porter, Curtis L. Norton

Chapter8: Operating Assets: Property, Plant, And Equipment, And Intangibles

Section: Chapter Questions

Problem 8.1E

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Property, Plant and Equipment (Part 2) Answer and Solution
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