Exercise 9-3

On March 1, 2017, Westmorlan Company acquired real estate on which it planned to construct a small office building. The company paid $95,000 in cash. An old warehouse on the property was razed at a cost of $8,900; the salvaged materials were sold for $1,600. Additional expenditures before construction began included $1,900 attorneys fee for work concerning the land purchase, $5,500 real estate brokers fee, $7,200 architects fee, and $14,700 to put in driveways and a parking lot. (a) Determine the amount to be reported as the cost of the land.