Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

P10-1 (L01) Classification of Acquisition and Other Asset Costs At December 31, 2016, certain accounts included in the property, plant, and equipment section of Reagan

image text in transcribed
P10-1 (L01) Classification of Acquisition and Other Asset Costs At December 31, 2016, certain accounts included in the property, plant, and equipment section of Reagan Company's balance sheet had the following balances Land Buildings Leasehold improvements Machinery and equipment $ 230,000 890,000 660,000 875,000 During 2017, the following transactions occurred 1. Cost of land site number 621 acquired Commission to a real estate agent to acquire land Cost of clearing land Sale of timber and gravel that were recovered during the land clearing $ 850,000 51,000 35,000 13,000 2. Second tract of land (site number 622) with a building Land value as indicated on the closing statement Building value as indicated on the closing statement Cost of demolition of the building shortly after acquisition Cost of new building constructed Additional costs of constructing building: $ 420,000 300,000 120,000 41,000 330,000 Excavation fees Architectural design fees Building permit fees Imputed interest on funds used during construction (stock financing) 38,000 11,000 2,500 8,500 Sept. 30, 2017 Completion and occupancy date of building 3. Acquisition of a third tract of land (site number 623) (Put on the market for resale) 4. Costs of improving leased office during December 2017. The related lease will 650,000 $ 89,000 terminate on December 31, 2019, and is not expected to be renewed (Hint: Leasehold improvements should be handled in the same manner as land improvements.) Purchase of a group of new machines under a royalty agreement that provides for payment of royalties based on units of production for the machines 5. Invoice price of the machines Freight costs Installation costs Royalty payments for 2017 $ 87.000 3,300 2,400 17,500 (AICPA adapted) Instructions: (a) Prepare a detailed analysis of the changes in each of the following balance sheet accounts for 2017 Land Buildings Leasehold Improvements quiomelated accumulated depreciatio Disregard the related accumulated depreciation accounts REAGAN COMPANY

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Corporate Environmental Responsibility Accounting And Corporate Finance In The EU

Authors: Panagiotis Dimitropoulos, Konstantinos Koronios

1st Edition

3030727726, 9783030727727

More Books

Students also viewed these Accounting questions

Question

21. What type of boss do you prefer?

Answered: 1 week ago

Question

What are the stages of project management? Write it in items.

Answered: 1 week ago