On July 1, 2024, Jekel & Hyde Incorporated purchased land and incurred other costs relative to the construction of a new warehouse A summary of economic activities is listed below: Purchase price Title insurance Legal fees to purchase land cost of razing old building on lot Proceeds from sale of salvageable materials Property taxes, January 1, 2024-June 30, 2024 Cost of grading and filling building site cost of building construction Interest on construction loan Cost of constructing driveway cost of parking lot and fencing $ 200,000 $3,000 $ 2,500 11,500 (2,700) 4,500 10,500 Land Building Land improvements 635,000 13,500 9,500 13,500 Required: Indicate the accounts that would be affected by the above transactions and the resulting balance in each account. Apply the interest on the construction loan to the cost of the building only.

On July 1, 2024, Jekel & Hyde Incorporated purchased land and incurred other costs relative to the construction of a new warehouse A summary of economic activities is listed below: Purchase price Title insurance Legal fees to purchase land cost of razing old building on lot Proceeds from sale of salvageable materials Property taxes, January 1, 2024-June 30, 2024 Cost of grading and filling building site cost of building construction Interest on construction loan Cost of constructing driveway cost of parking lot and fencing $ 200,000 $3,000 $ 2,500 11,500 (2,700) 4,500 10,500 Land Building Land improvements 635,000 13,500 9,500 13,500 Required: Indicate the accounts that would be affected by the above transactions and the resulting balance in each account. Apply the interest on the construction loan to the cost of the building only.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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