The Atlas Corporation hired an architect to design plans and a construction firm to build a new warehouse on a parcel of land it owns. The following data relates to the building: Price paid to the construction firm: $450,000 Architect fees: $25,000 Permit fees: $2,500 Property taxes during the construction period: $1,500 Insurance premium for the first year of operations: $4,500 Property taxes during the first year of operations: $8,000 The total acquisition cost of the new warehouse is: a. $491,500 b. $479,000 c. $450,000 d. $487,500
The Atlas Corporation hired an architect to design plans and a construction firm to build a new warehouse on a parcel of land it owns. The following data relates to the building: Price paid to the construction firm: $450,000 Architect fees: $25,000 Permit fees: $2,500 Property taxes during the construction period: $1,500 Insurance premium for the first year of operations: $4,500 Property taxes during the first year of operations: $8,000 The total acquisition cost of the new warehouse is: a. $491,500 b. $479,000 c. $450,000 d. $487,500
Chapter9: Acquisitions Of Property
Section: Chapter Questions
Problem 46P
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General Accounting
Transcribed Image Text:The Atlas Corporation hired an architect to design plans and
a construction firm to build a new warehouse on a parcel of
land it owns. The following data relates to the building:
Price paid to the construction firm: $450,000 Architect fees:
$25,000 Permit fees: $2,500 Property taxes during the
construction period: $1,500 Insurance premium for the first
year of operations: $4,500 Property taxes during the first year
of operations: $8,000
The total acquisition cost of the new warehouse is:
a. $491,500
b. $479,000
c. $450,000
d. $487,500
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