Grab Manufacturing Co. purchased a 10-ton draw press at a cost of $175,000 with terms of 4/15, n/45. Payment was made within the discount period. Shipping costs were $4,400, which included $210 for insurance in transit. Installation costs totaled $11,100, which included $4,800 for taking out a section of a wall and rebuilding it because the press was too large for the doorway. The capitalized cost of the 10-ton draw press is:

rev: 05_13_2016_QC_CS-51455

$183,500.

$187,000.

$181,500.

$188,500.

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Holiday Laboratories purchased a high-speed industrial centrifuge at a cost of $520,000. Shipping costs totaled $25,000. Foundation work to house the centrifuge cost $7,300. An additional water line had to be run to the equipment at a cost of $3,500. Labor and testing costs totaled $7,000. Materials used up in testing cost $2,900. The capitalized cost is:

$545,000.

$563,100.

$565,700.

$555,800.

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Juliana Corporation purchased all of the outstanding stock of Caldwell Inc., paying $3,100,000 cash. Juliana assumed all of the liabilities of Caldwell. Book values and fair values of acquired assets and liabilities were:

	Book Value	Fair Value
Current assets (net)	$350,000	$530,000
Property, plant, & equip. (net)	1,520,000	2,100,000
Liabilities	340,000	630,000

Juliana would record goodwill of:

$ 1,780,000.

$ 1,100,000.

$ 4,740,000.

$ 290,000.

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Horton Stores exchanged land and cash of $4,600 for similar land. The book value and the fair value of the land were $89,300 and $100,800, respectively.

Assuming that the exchange lacks commercial substance, Horton would record land-new and a gain/(loss) of:

	Land	Gain/(loss)
	$105,400	$11,500.

$93,900	$0.
$105,400	$0.

$93,900

$11,500.

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Bloomington Inc. exchanged land for equipment and $3,700 in cash. The book value and the fair value of the land were $105,900 and $88,600, respectively.

Bloomington would record equipment and a gain/(loss) of:

	Equipment	Gain/(loss)
	$84,900	$3,700.

$105,900	$(3,700).
$84,900	$(17,300).

All of these answer choices are incorrect.

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P. Chang & Co. exchanged land and $8,700 cash for equipment. The book value and the fair value of the land were $106,500 and $89,500, respectively.

Chang would record equipment and a gain/(loss) of:

Equipment Gain/(loss)

$98,200 $(17,000).

$106,500 $(8,700).

$89,500 $(25,700).

$106,500 $(17,000).

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Below is information relative to an exchange of similar assets by Grand Forks Corp. Assume the exchange has commercial substance.

	Old Equipment		Cash
	Book Value	Fair Value	Paid
Case A	$49,800	$59,300	$15,000
Case B	$40,200	$35,800	$ 8,700

In Case A, Grand Forks would record the new equipment at:

$49,800.

$74,300.

$59,300.

$64,800.

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Below is information relative to an exchange of equipment by Pensacola Inc. Assume the exchange has commercial substance.

	Old Equipment		Cash
	Book Value	Fair Value	Received
Case A	$73,700	$81,400	$11,600
Case B	$61,400	$54,300	$10,700

In Case B, Pensacola would record a gain/(loss) of:

$5,600.

$(7,100).

$(8,100).

None of these answer choices are correct.

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On January 1, 2016, Dreamworld Co. began construction of a new warehouse. The building was finished and ready for use on September 30, 2017. Expenditures on the project were as follows:

January 1, 2016	$307,000
September 1, 2016	$459,000
December 31, 2016	$459,000
March 31, 2017	$459,000
September 30, 2017	$307,000

Dreamworld had $5,300,000 in 13% bonds outstanding through both years.

Dreamworld's average accumulated expenditures for 2016 was:

$614,000.

$536,750.

$460,000.

$307,000.

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On January 1, 2016, Dreamworld Co. began construction of a new warehouse. The building was finished and ready for use on September 30, 2017. Expenditures on the project were as follows:

January 1, 2016	$320,000
September 1, 2016	$480,000
December 31, 2016	$480,000
March 31, 2017	$480,000
September 30, 2017	$320,000

Dreamworld had $6,000,000 in 14% bonds outstanding through both years.

The average accumulated expenditures for 2017 by the end of the construction period was:

$2,080,000.

$1,667,200.

$1,347,200.

$1,040,000.