On-Time Delivery Company acquired an adjacent lot to construct a new warehouse, paying $90,000 and giving a short-term note for $50,000. Legal fees paid were $1,750, delinquent taxes assumed were $25,000, and fees paid to remove an old building from the land were $9,000. Materials salvaged from the demolition of the building were sold for $1,000. A contractor was paid $415,000 to construct a new warehouse. Determine the cost of the land to be reported on the balance sheet.
On-Time Delivery Company acquired an adjacent lot to construct a new warehouse, paying $90,000 and giving a short-term note for $50,000. Legal fees paid were $1,750, delinquent taxes assumed were $25,000, and fees paid to remove an old building from the land were $9,000. Materials salvaged from the demolition of the building were sold for $1,000. A contractor was paid $415,000 to construct a new warehouse. Determine the cost of the land to be reported on the balance sheet.
Chapter11: Long-term Assets
Section: Chapter Questions
Problem 5Q: For each of the following transactions, state whether the cost would be capitalized (C) or recorded...
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![Determining Cost of Land
On-Time Delivery Company acquired an adjacent lot to construct a new warehouse,
paying $90,000 and giving a short-term note for $50,000. Legal fees paid were
$1,750, delinquent taxes assumed were $25,000, and fees paid to remove an old
building from the land were $9,000. Materials salvaged from the demolition of the
building were sold for $1,000. A contractor was paid $415,000 to construct a new
warehouse.
Determine the cost of the land to be reported on the balance sheet.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2f56ac34-33f6-43f5-b87f-fe9419ff4985%2F767bf844-dbf6-47e9-9e44-e33e45ae93a8%2F5golm9t_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Determining Cost of Land
On-Time Delivery Company acquired an adjacent lot to construct a new warehouse,
paying $90,000 and giving a short-term note for $50,000. Legal fees paid were
$1,750, delinquent taxes assumed were $25,000, and fees paid to remove an old
building from the land were $9,000. Materials salvaged from the demolition of the
building were sold for $1,000. A contractor was paid $415,000 to construct a new
warehouse.
Determine the cost of the land to be reported on the balance sheet.
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