1) Sunny Co. purchased land costing $2,550,000 as a future factory site. Sunny paid $240,000 to tear down two buildings on the land. Some Amish folks came along and paid them from the scrap lumber. They paid $2,450 cash for it. Sunny paid the lawyer $4,555 in fees for the title investigation and for making the purchase. The architect's fees were $85,600. The cost for the title insurance was $4,600, and liability insurance costs during the construction phase for the factory was $12,640. The excavation cost to clear the ground for the new building was $19,450. They paid the building contractor $8,200,000. The interest costs during the construction phase of the building was $465,000. What should Sunny record as cost of the building?

Question options: 8,200,000 9,022,690 8,782,690 8,770,050

2) Sunny Co. is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $6,400,000 on March 1, $5,280,000 on June 1, and $8,000,000 on December 31. Sunny Co. borrowed $3,200,000 on January 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 10%, 3-year, $6,400,000 note payable and an 11%, 4-year, $12,000,000 note payable. Question options: 8,413,333 19,680,000 11,680,000 9,840,000