1) Bonita Industries purchased land as a factory site for $1300000. Bonita paid $117000 to tear down two buildings on the land. Salvage was sold for $8400. Legal fees of $5140 were paid for title investigation and making the purchase. Architect's fees were $46500. Title insurance cost $3600, and liability insurance during construction cost $3900. Excavation cost $15140. The contractor was paid $4400000. An assessment made by the city for pavement was $9500. Interest costs during construction were $259000. The cost of the building that should be recorded by Bonita Industries is

a) $4405600.

b) $4406440.

c) $4420400.

d) $4724540.

2) Which of the following would not be considered property, plant, and equipment?

a) a tangible piece of equipment

b) a warehouse used to store inventory available for sale

c) an asset that will provide services over a number of years

d) an idle building

3) When an improvement to a piece of equipment extends the equipments useful life without increasing its productive capacity, the cost of the improvement should be

a) capitalized to the equipment account.

b) debited to accumulated depreciation.

c) expensed.

d) debited to a prepaid asset account.