Note: For Questions 18, respond to the following: During the year, Sloan Inc. began a project to construct new corporate headquarters. Sloan purchased land with an existing building for $750,000. The land was valued at $700,000 and the building at $50,000. Sloan planned to demolish the building and construct a new office building on the site. Note: For Questions 914, respond to the following: The following items (Questions 914)represent expenditures for goods held for resale and equipment. For each expenditure below, select the appropriate accounting treatment from the list provided. A selection may be used once, more than once, or not at all. Note: Answers 13 correspond with Questions 18. Answers 4 and 5 correspond with Questions 914. Purchase of land for $700,000 Interest of $147,000 on construction financing incurred after completion of construction Interest of $186,000 on construction financing paid during construction Purchase of building for $50,000 $18,500 payment of delinquent real estate taxes assumed by Sloan on purchase $12,000 liability insurance premium during the construction period $65,000 cost of razing existing building Moving costs of $136,000 Freight-in charges paid for goods held for resale In-transit insurance on goods held for resale purchased F.O.B. shipping point Interest on note payable for goods held for resale Installation of equipment Testing of newlypurchased equipment Cost of current year service contract on equipment

1.	Classify as land and do not depreciate.
2.	Classify as building and depreciate.
3.	Expense.
4.	Capitalized
5.	Expensed as a period cost

- 1. 2. 3. 4. 5.	Purchase of land for $700,000
- 1. 2. 3. 4. 5.	Interest of $147,000 on construction financing incurred after completion of construction
- 1. 2. 3. 4. 5.	Interest of $186,000 on construction financing paid during construction
- 1. 2. 3. 4. 5.	Purchase of building for $50,000
- 1. 2. 3. 4. 5.	$18,500 payment of delinquent real estate taxes assumed by Sloan on purchase
- 1. 2. 3. 4. 5.	$12,000 liability insurance premium during the construction period
- 1. 2. 3. 4. 5.	$65,000 cost of razing existing building
- 1. 2. 3. 4. 5.	Moving costs of $136,000
- 1. 2. 3. 4. 5.	Freight-in charges paid for goods held for resale
- 1. 2. 3. 4. 5.	In-transit insurance on goods held for resale purchased F.O.B. shipping point
- 1. 2. 3. 4. 5.	Interest on note payable for goods held for resale
- 1. 2. 3. 4. 5.	Installation of equipment
- 1. 2. 3. 4. 5.	Testing of newlypurchased equipment
- 1. 2. 3. 4. 5.	Cost of current year service contract on equipment