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An entity started construction on a building for its own use on 1 April 2 0 X 7 and incurred the following costs: $ 0
An entity started construction on a building for its own use on April X and incurred the following costs:
$
Purchase price of land
Stamp duty
Legal fees
Site preparation and clearance
Materials
Labour period April to July
Architects fees
General overheads
The following information is also relevant:
Material costs were greater than anticipated. On investigation, it was found that materials costing $ million had been spoiled and therefore wasted and a further $ million was incurred on materials as a result of faulty design work.
As a result of these problems, work on the building ceased for a fortnight during October and it is estimated that approximately $ million of the labour costs relate to this period.
The building was completed on July X and occupied on September X
Required:
Calculate the cost of the building that will be included in tangible noncurrent asset additions.
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