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BE9-1 The following expenditures were incurred by Rosenberg Company in purchas. ing land: cash price $64,000. accrued taxes $3,000, attorneys' fees $2.500. real estate broker's
BE9-1 The following expenditures were incurred by Rosenberg Company in purchas. ing land: cash price $64,000. accrued taxes $3,000, attorneys' fees $2.500. real estate broker's commission $2,000, and clearing and grading $3,800. What is the cost of the land? BE9-2 Jawson Company incurs the following expenditures in purchasing a truck: cash price 30,000, accident insurance 2,000, sales taxes 1,800, motor vehicle license 160, and painting and lettering 400. What is the cost of the truck? BE9-10 Tong Company had the following two transactions related to its delivery truck 1. Paid $45 for an oil change. 2. Paid $580 to install special gear unit, which increases the operating efficiency of the truck. Prepare Tong's journal entries to record these two transactions. 9-1 LO 1 Determining the Cost of Plant Assets DO IT! 9-1 Yockey Company purchased a delivery truck. The total cash payment was 27,820 including the following items. Negotiated purchase price 24,000 Installation of special shelving 1.100 Painting and lettering 780 Motor vehicle license 140 Annual insurance policy Sales tax 1,300 Total paid 27,820 500 Required: 1. Explain how each of these costs would be accounted for. Hint (Explain whether an operating expense or an asset cost). 2. Determine the cost of purchasing the truck. 9-2 LO 1
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