Problem 26-9 (AICPA Adapted) site. Le of ame At the beginning of current year, Melancholy Company reported the following property, plant and equipment: Land 3,500,000 Land improvements 900,000 Building 6,000,000 Equipment 1,500,000 rred 000 000 000 000 * 000 .000 000 ,000 ,000 The following transactions occurred during the current year. A tract of land was acquired for P1,250,000 and intended definitely for use as future building site. A plant facility consisting of land and building was acquired from another entity in exchange for 100,000 Melancholy Company shares. On the acquisition date, the share had a closing market price of P45 on a stock exchange. The plant facility was carried at P1,000,000 for land and P3,000,000 for the building at the exchange date. Current appraised values for the land and building, respectively, are P1,200,000 and P2,400,000. 5,000 ,000 1,000 0,000 5,000 0,000 Expenditures totaling P750,000 were made in early part of the year for new parking lot, Street and sidewalk at the entity's various plant locations. These expenditures had an estimated useful life of fifteen years. Equipment was purchased at a cost of P3,000,000. Freight and unloading charge of P50,000, and installation cost of P350,000 were incurred. At the middle of the current year, an equipment was sold for P175,000. The original cost of the equipment acquired two years ago was P500,000. The equipment was depreciated on the straight line basis over an estimated useful life of five years and no residual value. 737 1. What is total cost of land at year-end? a. 6,250,000 b. 5,950,000 c. 5,750,000 d. 9,250,000 2. What is the total cost of building at year-end? a. 8,400,000 b. 9,000,000 c. 8,250,000 d. 8,500,000 3. What is the total cost of land improvements at year-end? a. 1,650,000 b 900,000 750,000 800,000 4. What is the total cost of equipment at year-end? a. 4,600,000 b. 3,400,000 c. 4,900,000 d. 4,400,000