On February 1, 2021, KIKO Co. purchased a land and building for 10,000,000 as a factory site. The old building was not used (estimated useful life 5 years) and demolished right after the purchase. Construction began on a new building which was completed on November, 2024. Additional costs incurred are: Demolition of old building P 500,000
On February 1, 2021, KIKO Co. purchased a land and building for 10,000,000 as a factory site. The old building was not used (estimated useful life 5 years) and demolished right after the purchase. Construction began on a new building which was completed on November, 2024. Additional costs incurred are:
Demolition of old building P 500,000
Proceeds from sale of salvaged materials 80,000
Architect’s fees 250,000
Legal fees for title investigation and purchase contract 50,000
Income earned on a vacant space rented as parking lot
during construction 15,000
Construction cost 8,500,000
How much should KIKO record as the cost of the land and building respectively at December 31, 2021?
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