On June 28, 2020, in relocating to a new town, Pronghorn Corp, purchased a property consisting of two hectares of land and an unused building for $224,830 plus property taxes in arrears of $4,050. The company paid a real estate broker a fee of $11,640 for finding the property and legal fees on the purchase transaction of $5,510. The closing statement indicated that the assessed values for property tax purposes were $174,760 for the land and $34,960 for the building. Shortly after acquisition, the building was demolished at a cost of $23,510. Pronghorn Corp. then entered into a $1,300,200 fixed price contract with Maliseet Builders Inc, on August 1, 2020, for the construction of an office building on this site. The building was completed and occupied on April 29, 2021, as was a separate maintenance building that was constructed by Pronghorn's employees. Additional costs related to the property included: $25,400 82,200 42,000 46,000 Plans, specifications, and blueprints Architects' fees for design and supervision Landscaping Extras on contract for upgrading of windows External signage on the property Advertisements in newspaper and on television announcing opening of the building Gala opening party for customers, suppliers, and friends of Pronghorn Costs of internal direct labour and materials for maintenance building Allocated variable plant overhead based on direct labour hours worked on maintenance building 23,400 10,400 18,800 66,800 9,600 18,800 66,800 9,600 Gala opening party for customers, suppliers, and friends of Pronghorn Costs of internal direct labour and materials for maintenance building Allocated variable plant overhead based on direct labour hours worked on maintenance building Allocated cost of executive time spent on project Interest costs on debt incurred to pay contractor's progress billings up to building completion Interest costs on short-term loan to finance maintenance building costs 53,600 62.600 2.800 As an incentive for Pronghorn to locate and build in the town, the municipality agreed not to charge its normal building permit fees of $36,000. This amount was included in the $1,300,200 contract fee. Pronghorn uses the cost reduction method for any government grants, such as the waiving of these permit fees. The contract amount of $1,300,200 was reduced by this grant. The building and the maintenance building are estimated to have a 40-year life from their dates of completion and will be depreciated using the straight-line method with no residual value. Pronghorn is a private company with an April 30 year end, and the company accountant is currently analyzing the new Buildings account that was set up to capture all the expenditures and credits explained above that relate to the property. Part 1 X Your answer is incorrect. Compute the costs that would be capitalized and included in the new Buildings account on the April 30, 2021 statement of financial position, assuming the accountant wants to comply with ASPE but tends to be very conservative in nature in other words, she does not want to overstate income or assets assuming the fixed fee contract is reduced by municipal government grant amount Cost of building $ 1496200 e Textbook and Media Attempts: 1 of 2 used Submit Answer Save for Later