Chapter 11, Problem 11.5E

Show the complete solution of the following: 1. What is the cost of the land?2. What is the cost of the land improvement?3. What is the cost of the building?

The following information is for a long-term construction project for Moses Company that is finished on December 31, 2022. Capital expenditures during 2022: Date January 1, 2022 March 1, 2022 June 30, 2022 December 31, 2022 Actual Expenditures $2,220,720 300,000 500,000 500,000 Outstanding debt in 2022: Debt Issuance Date Debt Amount Interest Rate January 1, 2022 January 1, 2022 March 1, 2020 January 1, 2015 June 30, 2021 $ 800,000 150,000 600,000 1,000,000 600,000 Construction loan 12% Note payable Note payable Bonds payable Note payable 10% 8% 13% 12%

Please help solve

Please help solve

At the end of 2020, Magenta Manufacturing Company discovered that construction cost had been capitalized as a cost of the factory building in 2015 when it should have been treated as a cost of production equipment installation costs. As a result of the misclassification, the depreciation through 2018 was understated by 110,000, and depreciation for 2019 was understated by 90,000. What would be the consequences of correcting for the misclassification of the property cost? a. The taxpayer uses the FIFO inventory method, and 25% of goods produced during the period were included in the ending inventory. b. The taxpayer uses the LIFO inventory method, and no new LIFO layer was added during 2019.

You invest $7,500,000 in a commercial building that you place into service on 2/1/2023. How much can you deduct in depreciation for 2023? And for 2024?

Prepare the entry to record depreciation for 2026.

Addition of a sprinkler system to the manufactoring facility to reduce the risk of fire damage, $36,700 would be an expense in the period occured or would be capitalized and depreciated over the useful life of the asset?

A building that was purchased on December 31, 2006, for $2,500,000 was originally estimated to have a life of 50 years with no salvage value at the end of that time. Depreciation has been recorded through 2020. During 2021, an examination of the building by an ­engineering firm discloses that its estimated useful life is 15 years ­after 2020. What should be the amount of depreciation for 2021?