Allocating Payments and Receipts to Fixed Asset Accounts

The following payments and receipts are related to land, land improvements, and buildings acquired for use in a wholesale ceramic business. The receipts are identified by an asterisk.

a.	Fee paid to attorney for title search	$3,600
b.	Cost of real estate acquired as a plant site: Land	383,300
	Building (to be demolished)	36,400
c.	Delinquent real estate taxes on property, assumed by purchaser	21,600
d.	Cost of tearing down and removing building acquired in (b)	6,000
e.	Proceeds from sale of salvage materials from old building	3,600*
f.	Special assessment paid to city for extension of water main to the property	14,400
g.	Architects and engineers fees for plans and supervision	52,700
h.	Premium on one-year insurance policy during construction	5,100
i.	Cost of filling and grading land	21,100
j.	Money borrowed to pay building contractor	898,900*
k.	Cost of repairing windstorm damage during construction	6,600
l.	Cost of paving parking lot to be used by customers	18,200
m.	Cost of trees and shrubbery planted	10,800
n.	Cost of floodlights installed on parking lot	1,200
o.	Cost of repairing vandalism damage during construction	3,000
p.	Proceeds from insurance company for windstorm and vandalism damage	7,200*
q.	Payment to building contractor for new building	958,300
r.	Interest incurred on building loan during construction	45,000
s.	Refund of premium on insurance policy (h) canceled after 11 months	425*

Required:

1. Assign each payment and receipt to Land (unlimited life), Land Improvements (limited life), Building, or Other Accounts. Choose the correct account from the dropdown list for each letter and enter the appropriate amount. Enter receipts as negative amounts using the minus sign.

Item	Account (Land,Land Improvements, Building,Other accounts)	Amount
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
k.
l.
m.
n.
o.
p.
q.
r.
s.

2. Determine the amount debited to Land, Land Improvements, and Building.

Land	Land Improvements	Building