Parks Inc. had recently completed construction of a new manufacturing facility. Prior to the approval of the building permits, the company operated a parking lot on the land. This parking lot had revenues, net of costs, of $130,000. Construction will take place over an 18-month period. Total construction costs were as follows: Material Labour Incremental overhead General overhead Interest costs on general loan Cost of building permits $ 640,000 1,100,000 240,000 100,000 200,000 40,000
Parks Inc. had recently completed construction of a new manufacturing facility. Prior to the approval of the building permits, the company operated a parking lot on the land. This parking lot had revenues, net of costs, of $130,000. Construction will take place over an 18-month period. Total construction costs were as follows: Material Labour Incremental overhead General overhead Interest costs on general loan Cost of building permits $ 640,000 1,100,000 240,000 100,000 200,000 40,000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:Parks Inc. had recently completed construction of a new manufacturing facility. Prior to the approval of the building permits, the
company operated a parking lot on the land. This parking lot had revenues, net of costs, of $130,000. Construction will take place over
an 18-month period. Total construction costs were as follows:
Material
Labour
Incremental overhead
General overhead
Interest costs on general loan
Cost of building permits
$ 640,000
1,100,000
240,000
100,000
200,000
40,000
Required:
Provide the total amount of construction costs that would be capitalized to the cost of the building using ASPE. Indicate the items that
are different as compared to IFRS. (Negative amounts should be indicated by a minus sign.)
Capitalized
Expensed
Material
Labour
Incremental overhead
General overhead
Interest costs on general loan
Cost of building permits
Parking lot operation
Total
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