2)

In 2001, ProSports paid $2,800,000 for a tract of land and two buildings on it. The plan was to demolish Building One and build a new store in its place. Building Two was to be used as a company office and was appraised at a value of $641,300, with a useful life of 20 years and an $80,000 salvage value. A lighted parking lot near Building One had improvements (Land Improvements One) valued at $408,100 that were expected to last another 14 years and have no salvage value. Without considering the buildings or improvements, the tract of land was estimated to have a value of $1,865,600. ProSports incurred the following addi- tional costs: Cost to demolish Building One ......... $422,600 Cost of additional landscaping .............." 167,200 Cost to construct new building (Building Three), having a useful life of 25 years and a $390,100 salvage value......... 2,019,000 Cost of new land improvements near Building Two (Land Improvements Two) which have a 20-year useful life and no salvage value 158,000 Required 1. Prepare a schedule having the following column headings: Land, Building Two, Building Three, Land Improvements One, and Land Improvements Two. Allocate the costs incurred by ProSports to the appropriate columns and total each column. 2. Prepare a single journal entry dated March 31 to record all the incurred costs, assum- ing they were paid in cash on that date