Werner's Fish House purchases a tract of land and an existing building for $870,000. The company plans to remove the oid bulding and construct a new restaurant on the site. In addition to the purchase price, Werner pays closing costs, including title insurance of $1700. The company also pays $11,400 in property taxes, which includes $7700 of back taxes (unpaid taxes from previous years) paid by Werner on behalf of the seller and $3700 due for the current fiscal year after the purchase date. Shortly after closing, the company pays a contractor $43,500 to tear down the old building and remove it from the site. Werner is able to sell salvaged materials from the old bullding for $6,600 and pays an additional $11,800 to level the land. Required: Determine the amount Werner's Fish House should record as the cost of the land. (Amounts to be deducted should be indicated by a minus sign.) Total cost of the land
Werner's Fish House purchases a tract of land and an existing building for $870,000. The company plans to remove the oid bulding and construct a new restaurant on the site. In addition to the purchase price, Werner pays closing costs, including title insurance of $1700. The company also pays $11,400 in property taxes, which includes $7700 of back taxes (unpaid taxes from previous years) paid by Werner on behalf of the seller and $3700 due for the current fiscal year after the purchase date. Shortly after closing, the company pays a contractor $43,500 to tear down the old building and remove it from the site. Werner is able to sell salvaged materials from the old bullding for $6,600 and pays an additional $11,800 to level the land. Required: Determine the amount Werner's Fish House should record as the cost of the land. (Amounts to be deducted should be indicated by a minus sign.) Total cost of the land
Chapter9: Acquisitions Of Property
Section: Chapter Questions
Problem 42P
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![Wermer's Fish House purchases a tract of land and an existing building for $870,000. The company plans to remove the old bullding
and construct a new restaurant on the site. In addition to the purchase price, Werner pays closing costs, including title insurance of
$1700. The company also pays $11,400 in property taxes, which includes $7700 of back taxes (unpaid taxes from previous years) paid
by Werner on behalf of the seller and $3700 due for the current fiscal year after the purchase date. Shortly after closing, the company
pays a contractor $43,500 to tear down the old building and remove it from the site. Werner is able to sell salvaged materials from the
old building for $6,600 and pays an additional $11800 to level the land.
Required:
Determine the amount Werner's Fish House should record as the cost of the land. (Amounts to be deducted should be indicated by a
minus sign.)
Total cost of the land](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fce0bf1ce-a72f-4c39-9220-c140fca8fd2c%2F4b088edc-b9df-43d2-86ee-0508ce60593b%2Fzcqqcr_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Wermer's Fish House purchases a tract of land and an existing building for $870,000. The company plans to remove the old bullding
and construct a new restaurant on the site. In addition to the purchase price, Werner pays closing costs, including title insurance of
$1700. The company also pays $11,400 in property taxes, which includes $7700 of back taxes (unpaid taxes from previous years) paid
by Werner on behalf of the seller and $3700 due for the current fiscal year after the purchase date. Shortly after closing, the company
pays a contractor $43,500 to tear down the old building and remove it from the site. Werner is able to sell salvaged materials from the
old building for $6,600 and pays an additional $11800 to level the land.
Required:
Determine the amount Werner's Fish House should record as the cost of the land. (Amounts to be deducted should be indicated by a
minus sign.)
Total cost of the land
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