On December 1, 20120, Boyd Co. purchased a 400,000 tract of land for a factory site. Boyd razed an oldbuilding on the property and sold the materials it salvaged from the demolition. Boyd incurred additionalcosts and realized salvage proceeds during December 2010 as follows:Demolition of old building50,000.00Legal fees for purchase contract and recording ownership 10,000.00Title guarantee insurance12,000.0012,000.00Proceeds from sale of salvaged materialsIn its December 31, 2010 balance sheet, Boyd should report a balance in the land account of442,000460,000422,000464,000

Introduction: The balance sheet is among the three basic financial statements that are required for…

On December 1, 20120, Boyd Co. purchased a 400,000 tract of land for a factory site. Boyd razed an old building on the property and sold the materials it salvaged from the demolition. Boyd incurred additional costs and realized salvage proceeds during December 2010 as follows: 50,000.00 Demolition of old building Legal fees for purchase contract and recording ownership 10,000.00 Title guarantee insurance 12,000.00 12,000.00 Proceeds from sale of salvaged materials In its December 31, 2010 balance sheet, Boyd should report a balance in the land account of 442,000 460,000 422,000 464,000

On December 1, 20120, Boyd Co. purchased a 400,000 tract of land for a factory site. Boyd razed an old building on the property and sold the materials it salvaged from the demolition. Boyd incurred additional costs and realized salvage proceeds during December 2010 as follows: 50,000.00 Demolition of old building Legal fees for purchase contract and recording ownership 10,000.00 Title guarantee insurance 12,000.00 12,000.00 Proceeds from sale of salvaged materials In its December 31, 2010 balance sheet, Boyd should report a balance in the land account of 442,000 460,000 422,000 464,000

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

Sunset Co. Acquired land with old building for 6,000,000. After the acquisition, Sunset Co. Demolished the old structure and started the construction of a new building. Sunset Co. Incurred the following additional costs. Fimder's fee of real estate agent 80,000 Land registration cost 8,000 Unpais taxes on land prior to acquisition date 200,000 Taxes paid on property after acquisition date 60,000 Demolition cost of old building 130,000 Materials, labor and overhead on construction of new building 10,000,000 Salvaged materials from the demolition were sold for 10,000. Case 1: the land and the old building have fair values of 5,425,000 and 775,000, respectively . Provide the journal entries. Case 2: the old building is unusable and has no fair value. Provide the journal entries.
Again & Again Company acquired a machine on October 1, 2013 at a cost of P 2,500,000 and depreciated it at 25% per annum on a straight line basis. On October 1, 2015, the entity spent P 500,000 on upgrade to the machine in order to improve its efficiency and increase the inflow of economic benefits over the machine‘s remaining useful life. What amount of depreciation should be recognized for the year September 30, 2016? a. 750,000 b. 625,000 c. 850,000 d. 875,000
Asura Co. purchased land and building for a lump-sum price of P48,000,000. The existing building will be demolished and a new building will be constructed. Asura incurred the following additional costs: Title guarantee 80,000 Option paid for the land and old building acquired 24,000 Payments to tenants to vacate premises 48,000 Cost of razing the old building 240,000 Construction cost of new building (completed) 34,000,000 The land and old building have fair values of P20,000,000 and P40,000,000, respectively. Some salvaged wood planks from the demolition were used as wall panels in the new building. Asura estimates that the salvaged wood planks have a fair value of P120,000. The other salvaged materials were sold for P60,000. How much is the allocated cost of the old building? Answer:
Acquisition of Land and Building On February 1, 2019, Edwards Corporation purchased a parcel of land as a factory site for $100,000. It demolished an old building on the property and began construction on a new building that was completed on October 2, 2019. Costs incurred during this period are: Demolition of old building $ 8,000 Architect's fees 20,000 Legal fees for title investigation and purchase contract 5,000 Construction costs 625,000 Edwards sold salvaged materials resulting from the demolition for $2,000. Required: 1. At what amount should Edwards record the cost of the land and the new building, respectively? If an input box should be blank, enter a zero. Land Building Purchase price of land Demolition of old building Architect's fees Legal fees Construction costs Salvaged materials Total 2. Next Level If management misclassified a portion of the building's cost as part of the cost of the land, what would be the effect on the financial statements?
On June 1, 2015, Skylark Enterprises (not a corporation) acquired a retailstore building for $500,000 (with $100,000 being allocated to the land). Thestore building was 39-year real property, and the straight-line cost recovery methodwas used. The property was sold on June 21, 2019, for $385,000.a. Compute the cost recovery and adjusted basis for the building using Exhibit 8.8from Chapter 8.b. What are the amount and nature of Skylark’s gain or loss from disposition ofthe property? What amount, if any, of the gain is unrecaptured § 1250 gain?
Unilever acquires land for $86,000 cash. Additional costs are as follows: removal of shed $300, broker commission $1,530, paving of parking lot $10,000, gardening $1,500, closing costs $560, and a salvage value of lumber of shed $120. Unilever will record the acquisition cost of the land as:
Auto purchased a $500,000 tract of land that is intended to be the site of a new office complex. The company incurred additional costs and realized salvage proceeds as follows: Demolilitipn of existing building on site: $75,000 Legal and other fees to close escrow: $15,000 Proceeds from sale of demolition scrap: $10,000 What would be the cost of land? A. $500,000 B. $575,000 C. $580,000 D. $590,000
On July 1, 2016, Drenz Inc. purchased land and incurred other costs relative to the construction of a new warehouse. A summary of economic activities is listed below: Purchase price 925,000 Title Insurance 7,500 Legal fees to purchase land 5,000 Cost of razing old building on lot 42,500 Proceeds from sale of salvageable materials (6,000) Property taxes, January 1, 2016 - June 30, 2016 15,000 Cost of grading and filling building site 45,000 Cost of building construction 3,100,000 Interest on construction loan 60,000 Cost of constructing driveway 400,000 Cost of parking lot and fencing 60,000 Compute for the cost of the land?
During the current year, Alanna Co. had the following transactions pertaining to its new office building. Purchase price of land $120,000 Legal fees for contracts to purchase land 5,000 Architech fees 15,000 Demolition of the old building on site 12,000 Sale of scrap from old building 7,000 Construction cost of new building 680,000 A. What should Alanna Co. record on its books for the land? K) The total cost of land includes all costs of preparing the land for use. The demolition cost of the old building is added to the land costs, and the sale of the old building scrap is subtracted from the land cost. $1 B. What should Alanna Co. record on its books for the building?
On December 31, 2020, Listach Inc. sold a used industrial crane for $600,000 cash. The original cost of the crane was $5.0 million and its accumulated depreciation equaled $4.2 million on December 31, 2020. What is the gain or loss from the December 31, 2020 equipment sale? Group of answer choices A)$800,000 gain B)$800,000 loss C)$200,000 loss D)$200,000 gain E)None of the above