Question
CAPITALIZINGTHECOSTOFANASSETCaseyCorporationpurchasedfourassets--Land,Buildings,EquipmentandLandImprovements.Thebuildingis20yearsoldandneedsrefurbishment.Determinethecostofeachassetbycapitalizingtheappropriatecosts.1LANDPurchasePrice$22,000DelinquentPropertyTaxesOwedbyPreviousOwner4,000ClearingandGradingCosts12,000CosttoDrainSwamponLand15,000CosttoTearDownOldBuilding9,000BrokerageandTitleFees3,000WhatamountshouldbedebitedtoLand?02BUILDINGSPurchasePrice$180,000CosttoReplaceRoof9,000CostofNewHeatingandPlumbingFixtures15,000GovernmentPermits5,000CosttoRemoveGraffittifromWallsDuringRefurbishment3,000BrokerageFees6,000CostofLegalAdviceinthePurchase4,000WhatamountshouldbedebitedtoBuilding?03EQUIPMENTPurchasePrice$14,000CosttoInstalltheEquipment5,000CostofTestRunstoAdjusttheEquipment2,500SalesTaxesPaidfortheEquipment1,500FreightChargestoDelivertheEquipment2,000WhatamountshouldbedebitedtoEquipment?04LANDIMPROVEMENTSNewFenceConstructedAroundBuilding$8,000NewCompanySignatFrontDoor12,000FlagPoleInstallation5,000SidewalkReconstruction9,000WhatamountshouldbedebitedtoLandImprovements?0
CAPITALIZINGTHECOSTOFANASSETCaseyCorporationpurchasedfourassets--Land,Buildings,EquipmentandLandImprovements.Thebuildingis20yearsoldandneedsrefurbishment.Determinethecostofeachassetbycapitalizingtheappropriatecosts.1LANDPurchasePrice$22,000DelinquentPropertyTaxesOwedbyPreviousOwner4,000ClearingandGradingCosts12,000CosttoDrainSwamponLand15,000CosttoTearDownOldBuilding9,000BrokerageandTitleFees3,000WhatamountshouldbedebitedtoLand?02BUILDINGSPurchasePrice$180,000CosttoReplaceRoof9,000CostofNewHeatingandPlumbingFixtures15,000GovernmentPermits5,000CosttoRemoveGraffittifromWallsDuringRefurbishment3,000BrokerageFees6,000CostofLegalAdviceinthePurchase4,000WhatamountshouldbedebitedtoBuilding?03EQUIPMENTPurchasePrice$14,000CosttoInstalltheEquipment5,000CostofTestRunstoAdjusttheEquipment2,500SalesTaxesPaidfortheEquipment1,500FreightChargestoDelivertheEquipment2,000WhatamountshouldbedebitedtoEquipment?04LANDIMPROVEMENTSNewFenceConstructedAroundBuilding$8,000NewCompanySignatFrontDoor12,000FlagPoleInstallation5,000SidewalkReconstruction9,000WhatamountshouldbedebitedtoLandImprovements?0
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