I please get help with this question and a quck explaination of how?(5.7) On January 1, Mitzu Company pays a lump-sum amount of $2,650,000 for land, Building 1, Building 2, and Land Improvements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $780,000, with a useful life of 20 years and a $75,000 salvage value. Land Improvements 1 is valued at $360,000 and is expected to last another 12 years with no salvage value. The land is valued at $1,860,000. The company also incurs the following additional costs. Cost to demolish Building 1 $ 348,400 Cost of additional land grading 195,400 Cost to construct Building 3, having a useful life of 25 years and a $398,000 salvage value 2,242,000 Cost of new Land Improvements 2, having a 20-year useful life and no salvage value 168,000
I please get help with this question and a quck explaination of how?(5.7) On January 1, Mitzu Company pays a lump-sum amount of $2,650,000 for land, Building 1, Building 2, and Land Improvements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $780,000, with a useful life of 20 years and a $75,000 salvage value. Land Improvements 1 is valued at $360,000 and is expected to last another 12 years with no salvage value. The land is valued at $1,860,000. The company also incurs the following additional costs. Cost to demolish Building 1 $ 348,400 Cost of additional land grading 195,400 Cost to construct Building 3, having a useful life of 25 years and a $398,000 salvage value 2,242,000 Cost of new Land Improvements 2, having a 20-year useful life and no salvage value 168,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Can I please get help with this question and a quck explaination of how?(5.7)
On January 1, Mitzu Company pays a lump-sum amount of $2,650,000 for land, Building 1, Building 2, and Land Improvements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $780,000, with a useful life of 20 years and a $75,000 salvage value. Land Improvements 1 is valued at $360,000 and is expected to last another 12 years with no salvage value. The land is valued at $1,860,000. The company also incurs the following additional costs.
| Cost to demolish Building 1 | $ 348,400 |
|---|---|
| Cost of additional land grading | 195,400 |
| Cost to construct Building 3, having a useful life of 25 years and a $398,000 salvage value | 2,242,000 |
| Cost of new Land Improvements 2, having a 20-year useful life and no salvage value | 168,000 |
Transcribed Image Text:Record the cost of the plant assets, paid in cash.
Note: Enter debits before credits.
Date
January 01
Record entry
General Journal
Clear entry
Debit
Credit
View general journal
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