Question
Cala Manufacturing purchases a large lot on which an old building is located as part of its plans to build a new plant. The negotiated
Cala Manufacturing purchases a large lot on which an old building is located as part of its plans to build a new plant. The negotiated purchase price is $254,000 for the lot plus $149,000 for the old building. The company pays $25,200 to tear down the old building and $37,252 to fill and level the lot. It also pays a total of $1,727,150 in construction coststhis amount consists of $1,624,600 for the new building and $102,550 for lighting and paving a parking area next to the building. Prepare a single journal entry to record these costs incurred by Cala, all of which are paid in cash.
Journal entry worksheet
- Record the total costs of the plant assets.
Note: Enter debits before credits.
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