Ogden Furniture, Co., purchased land, paying $70,000 cash plus a $300,000 note payable. In addition, Ogden paid delinquent property tax of $2,500, title insurance costing $2,000, and $8,000 to level the land and remove an unwanted building. The company then constructed an office building at a cost of $700,000. It also paid $55,000 for a fence around the property, $18,000 for a sign near the entrance, and $10,000 for special lighting of the grounds.
Requirements
1. Determine the cost of the land, land improvements, and building.
2. Which of these assets will Ogden depreciate?