On March 31, 2023, Capital Investment Advisers paid $4,570,000 for land with two buildings on it. The plan was to demolish Building 1 and build a new store (Building 3) in its place. Building 2 was to be used as a company office and was appraised at a value of $1,074.790. A lighted parking lot near Building 2 had improvements (Land Improvements 1) valued at $607.490. Without considering the buildings or improvements, the tract of land was estimated to have a value of $2,990,720. Capital incurred the following additional costs: Cost to demolish Building 1 Cost of additional landscaping Cost to construct new building (Building 3) Cost of new land improvements near Building 2 (Land Improvements 2) Required: 1. Allocate the costs incurred by Capital to the appropriate columns and total each column. Purchase price Demolition Land Building 2 Building 3 $703,160 272,020 2,476,000 254,600 Land Land Improvements 1 Improvements 2
On March 31, 2023, Capital Investment Advisers paid $4,570,000 for land with two buildings on it. The plan was to demolish Building 1 and build a new store (Building 3) in its place. Building 2 was to be used as a company office and was appraised at a value of $1,074.790. A lighted parking lot near Building 2 had improvements (Land Improvements 1) valued at $607.490. Without considering the buildings or improvements, the tract of land was estimated to have a value of $2,990,720. Capital incurred the following additional costs: Cost to demolish Building 1 Cost of additional landscaping Cost to construct new building (Building 3) Cost of new land improvements near Building 2 (Land Improvements 2) Required: 1. Allocate the costs incurred by Capital to the appropriate columns and total each column. Purchase price Demolition Land Building 2 Building 3 $703,160 272,020 2,476,000 254,600 Land Land Improvements 1 Improvements 2
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question

Transcribed Image Text:On March 31, 2023, Capital Investment Advisers paid $4,570,000 for land with two buildings on it. The plan was to demolish Building 1
and build a new store (Building 3) in its place. Building 2 was to be used as a company office and was appraised at a value of
$1,074,790. A lighted parking lot near Building 2 had improvements (Land Improvements 1) valued at $607,490. Without considering
the buildings or improvements, the tract of land was estimated to have a value of $2,990,720. Capital incurred the following additional
costs:
Cost to demolish Building 1
Cost of additional landscaping
Cost to construct new building (Building 3)
Cost of new land improvements near Building 2 (Land Improvements 2)
Required:
1. Allocate the costs incurred by Capital to the appropriate columns and total each column.
Purchase price
Demolition
Landscaping
New building
New improvements
Totals
View transaction list
$
Land
Journal entry worksheet
< 1
Record costs of plant assets.
Date
Mar 31
0 $
Note: Enter debits before credits.
Building 2
0 $
General Journal
Building 3
2. Prepare a single journal entry dated March 31, 2023, to record all the incurred costs, assuming they were paid in cash on that date.
Debit
Land
Land
Improvements 1 Improvements 2
0 $
$ 703,160
272,020
2,476,000
254,600
Credit
S
0
Expert Solution

This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps

Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you


Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,

Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,


Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,

Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,

Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON

Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education

Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education