Falcon Waste Management purchased land and a warehouse for $760,000. In addition to the purchase price, Falcon made the following expenditures related to the acquisition: broker's commission, $46,000; title insurance, $11,000; miscellaneous closing costs, $14,000. The warehouse was immediately demolished at a cost of $34,000 in anticipation of the building of a new warehouse. Determine the amounts Falcon should capitalize as the cost of the land and the building. Capitalized cost of land Capitalized cost of building $ 865,000

Falcon Waste Management purchased land and a warehouse for $760,000. In addition to the purchase price, Falcon made the following expenditures related to the acquisition: broker's commission, $46,000; title insurance, $11,000; miscellaneous closing costs, $14,000. The warehouse was immediately demolished at a cost of $34,000 in anticipation of the building of a new warehouse. Determine the amounts Falcon should capitalize as the cost of the land and the building. Capitalized cost of land Capitalized cost of building $ 865,000

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter5: Introduction To Business Expenses

Section: Chapter Questions

Problem 39P

See similar textbooks

Similar questions

Tree Lovers Inc. purchased 2,500 acres of woodland in which it intends to harvest the complete forest, leaving the land barren and worthless. Tree Lovers paid $5,000,000 for the land. Tree Lovers will sell the lumber as it is harvested and it expects to deplete it over ten years (150 acres in year one, 300 acres in year two, 250 acres in year three, 150 acres in year four, and 100 acres in year five). Calculate the depletion expense for the next five years and create the journal entry for year one.
Fullerton Waste Management purchased land and a warehouse for $710,000. In addition to the purchase price, Fullerton made the following expenditures related to the acquisition: broker's commission, $41,000; title insurance, $8,500; miscellaneous closing costs, $11,500. The warehouse was immediately demolished at a cost of $29,000 in anticipation of the building of a new warehouse. Determine the amounts Fullerton should capitalize as the cost of the land and the building. 3 Capitalized cost of land Capitalized cost of building o
Soccer Wholesale purchased land and a warehouse for one price of $850,000. In addition to the purchase price, Soccer Wholesale makes the following expenditures related to the acquisition: broker's commission, $44,400; title insurance, $2,800; and miscellaneous closing costs, $7,300. The warehouse is immediately demolished at a cost of $83,900 in anticipation of building a new warehouse. Determine the amount Soccer Wholesale should record as the cost of the land. Cost of the land
Fresh Veggies, Incorporated (FVI), purchases land and a warehouse for $490,000. In addition to the purchase price, FVI makes the following expenditures related to the acquisition: broker's commission, $29,000; title insurance, $1,900; and miscellaneous closing costs, $6,000. The warehouse is immediately demolished at a cost of $29,000 in anticipation of building a new warehouse. Determine the cost of the land and record the purchase (assuming cash was paid for all expenditures). (If no entry is required for a particular transaction/event, select "No Journal Entry Required" in the first account field.) View transaction list Journal entry worksheet Record the purchase of the land. Note: Enter debits before credits. Transaction 1 Record entry General Journal Clear entry Debit Credit View general Journal
Unilever acquires land for $86,000 cash. Additional costs are as follows: removal of shed $300, broker commission $1,530, paving of parking lot $10,000, gardening $1,500, closing costs $560, and a salvage value of lumber of shed $120. Unilever will record the acquisition cost of the land as:
Fresh Veggies, Inc. (FVI), purchases land and a warehouse for $490,000. In addition to the purchase price, FVI makes the following expenditures related to the acquisition: broker’s commission, $29,000; title insurance, $1,900; and miscellaneous closing costs, $6,000. The warehouse is immediately demolished at a cost of $29,000 in anticipation of building a new warehouse. Determine the amount FVI should record as the cost of the land.
Falcon Waste Management purchased land and a warehouse for $650,000. In addition to the purchase price, Falcon made the following expenditures related to the acquisition: broker's commission, $35,000; title insurance, $5,500; miscellaneous closing costs, $8,500. Assume that Falcon decides to use the warehouse rather than demolish it. An independent appraisal estimates the fair values of the land and warehouse at $637,500 and $112,500, respectively. Determine the amounts Falcon should capitalize as the cost of the land and the building. Answer is not complete. Capitalized cost of land Capitalized cost of building
Samtech Manufacturing purchased land and building for $4 million. In addition to the purchase price, Samtech made the following expenditures in connection with the purchase of the land and building: Title insurance $16,000 Legal fees for drawing the contract 5,000 Pro-rated property taxes for the period after the acquisition 36,000 State transfer fees 4,000 An independent appraisal estimated the fair values of the land and building, if purchased separately, at $3.3 and $1.1 million, respectively. Shortly after the acquisition, Samtech spent $82,000 to construct a parking lot and $40,000 for landscaping. Required: Determine the initial valuation of each asset Samtech acquired in these transactions.
Samtech Manufacturing purchased land and a building for $4 million. In addition to the purchase price, Samtech made the following expenditures in connection with the purchase of the land and building: Title insurance Legal fees for drawing the contract Pro-rated property taxes for the period after acquisition State transfer fees An independent appraisal estimated the fair values of the land and building, if purchased separately, at $3.2 and $1.8 million, respectively. Shortly after acquisition, Samtech spent $92,000 to construct a parking lot and $50,000 for landscaping. Required: 1. Determine the initial valuation of each asset Samtech acquired in these transactions. 2. Determine the initial valuation of each asset, assuming that immediately after acquisition, Samtech demolished the building. Demolition costs were $350,000 and the salvaged materials were sold for $6,000. In addition, Samtech spent $89,000 clearing and grading the land in preparation for the construction of a new…
Samtech Manufacturing purchased land and a building for $4 million. In addition to the purchase price, Samtech made the following expenditures in connection with the purchase of the land and building: Title insurance $ 22,000 Legal fees for drawing the contract 8,000 Pro-rated property taxes for the period after acquisition 42,000 State transfer fees 4,600 An independent appraisal estimated the fair values of the land and building, if purchased separately, at $4 and $1 million, respectively. Shortly after acquisition, Samtech spent $88,000 to construct a parking lot and $46,000 for landscaping. Required: Determine the initial valuation of each asset Samtech acquired in these transactions. Determine the initial valuation of each asset, assuming that immediately after acquisition, Samtech demolished the building. Demolition costs were $310,000 and the salvaged materials were sold for $9,000. In addition, Samtech spent $85,000 clearing and grading the land in preparation for…
Samtech Manufacturing purchased land and building for $3 million. In addition to the purchase price, Samtech made the following expenditures in connection with the purchase of the land and building: Title insurance Legal fees for drawing the contract Pro-rated property taxes for the period after acquisition State transfer fees $ 29,000 6,500 49,000 5,300 An Independent appraisal estimated the fair values of the land and building, if purchased separately, at $3 and $2 million, respectively. Shortly after acquisition, Samtech spent $95,000 to construct a parking lot and $53,000 for landscaping. Required: 1. Determine the initial valuation of each asset Samtech acquired in these transactions. 2. Determine the initial valuation of each asset, assuming that immediately after acquisition, Samtech demolished the building. Demolition costs were $380,000 and the salvaged materials were sold for $7,500. In addition, Samtech spent $92,000 clearing and grading the land in preparation for the…
help me