se the following information for the next three questions: Altitude Company purchased a plot of land for ₱2,000,000 as a plant site. There was a small office building on the plot, conservatively appraised at ₱700,000 which the company will continue to use with some modification and renovation. The renovation had plans drawn for a factory and received bids for its construction. It rejected all bids and decided to construct the plant itself. Below are listed additional items that management feels should be included in the property, plant and equipment accounts: Materials and supplies 3,000,000 Excavation 100,000 Labor on construction 2,500,000 Cost remodeling office building 200,000 Legal cost on conveying land 10,000 Imputed interest on corporation own money used during construction 120,000 Cash discounts on materials purchased, not taken 60,000 Supervision by management 70,000 Compensation insurance premium for workers 20,000 Clerical and other expenses related to construction 30,000 Paving of streets & sidewalks, not included in blueprint 40,000 Plans and specifications 140,000 Payment for claim for injuries not covered by insurance 25,000 Legal cost of injury claim 15,000 Saving on construction 200,000 78. The land should be reported at a. 1,310,000 c. 1,350,000 b. 1,300,000 d. 1,410,000 79. The office building should be reported at a. 1,050,000 c. 70,000 b. 900,000 d. 850,000 80. The factory building should be reported at a. 5,720,000 c. 5,800,000 b. 5,920,000 d. 5,600,000

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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Use the following information for the next three questions:
Altitude Company purchased a plot of land for ₱2,000,000 as a plant site. There was a small office
building on the plot, conservatively appraised at ₱700,000 which the company will continue to use with
some modification and renovation.
The renovation had plans drawn for a factory and received bids for its construction. It rejected all bids
and decided to construct the plant itself. Below are listed additional items that management feels
should be included in the property, plant and equipment accounts:

Materials and supplies	3,000,000
Excavation	100,000
Labor on construction	2,500,000
Cost remodeling office building	200,000
Legal cost on conveying land	10,000
Imputed interest on corporation own money
used during construction	120,000
Cash discounts on materials purchased, not taken	60,000
Supervision by management	70,000
Compensation insurance premium for workers	20,000
Clerical and other expenses related to construction	30,000
Paving of streets & sidewalks, not included in blueprint	40,000
Plans and specifications	140,000
Payment for claim for injuries not covered by insurance	25,000
Legal cost of injury claim	15,000
Saving on construction	200,000

78. The land should be reported at

a. 1,310,000 c. 1,350,000
b. 1,300,000 d. 1,410,000

79. The office building should be reported at
a. 1,050,000 c. 70,000
b. 900,000 d. 850,000

80. The factory building should be reported at
a. 5,720,000 c. 5,800,000
b. 5,920,000 d. 5,600,000

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