Telluride Mining Company purchased a new building to store its increasing supply of mining equipment. The building was purchased for $580,000. The purchase price did not include $40,000 worth of sales tax. Also related to the purchase, Telluride Mining Company had to pay $18,000 for title search costs and $25,000 in realtor fees. Finally, the company had to hire a security guard to protect the new building which is paid a salary of $80,000 per year. Required: Determine the amount to be capitalized in an asset account for the purchase of the new building. Amount to be capitalized
Telluride Mining Company purchased a new building to store its increasing supply of mining equipment. The building was purchased for $580,000. The purchase price did not include $40,000 worth of sales tax. Also related to the purchase, Telluride Mining Company had to pay $18,000 for title search costs and $25,000 in realtor fees. Finally, the company had to hire a security guard to protect the new building which is paid a salary of $80,000 per year. Required: Determine the amount to be capitalized in an asset account for the purchase of the new building. Amount to be capitalized
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Telluride Mining Company purchased a new building to store its increasing supply of mining equipment. The building was purchased
for $580,000. The purchase price did not include $40,000 worth of sales tax. Also related to the purchase, Telluride Mining Company
had to pay $18,000 for title search costs and $25,000 in realtor fees. Finally, the company had to hire a security guard to protect the
new building which is paid a salary of $80,000 per year.
Required:
Determine the amount to be capitalized in an asset account for the purchase of the new building.
Amount to be capitalized
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