Property Plant and Equipment

P 14,000 12,000 PROBLEM 19-3 Capitalizable Cost of Land, Building and Improvements-Old Building Will Be Demolished On March 1, 2018, Romie Milan Co. acquired land and building by paui P9,000,000 and assuming a mortgage of P1,000,000. The old building demolished for the construction of a new building. 1 Unpaid real property taxes up to the date of acquisition 2 Cost of option of the acquired properties 20,000 Excavation cost Escrow fees on the properties acquired 11,000 5 Cost of relocating and reconstructing the property belonging to others in order to acquire the properties 23,000 006 Payment to real estate agent 40,000 7 Payments to tenants of the properties to induce them to vacate the premises. 3,000 8 Legal fees for contract to purchase the land 11,000 9 Cost of removing trees from the land 70,000 10 Building permit and licenses 60,000 0 11 Architect fee DO 12 Materials used in construction 600,000 13 Driveway and walk to building (part of building plan) 30,000 14 Payment for claim for injuries not covered by insurance 40,000 DO 15 Broker's fee on the properties acquired 10,000 00 16 Rental fees generated on the portion of the building being 0000used as a parking site OD 17 Cost of paving parking lot adjoining building 18 Other overhead cost incurred as result of construction 50,000 23,500 50,000 220,000 vice equipment and fixtures made a permanent part of the 19 Service equipme Questions: structure. Safety fence around construction site 11,000 Removal of safety fence 35,000 Demolition cost of the old building 9,800 Proceeds from salvage of the demolition 33,000 4,000 sed on the above data, determine the adjusted cost of the following: CASE NO. 1: Assume that on the date of acquisition, the land and building have fair values of P7,000,000 and P1,000,000 respectively. 1. Land a. P8,855,875 c. P8,936,875 b. P10,202,000 d. P10,265,500 2. The allocated cost of the old building that will be charged to loss. a. Nil c. P1,378,625 325 b. P1,265,125 d. P1,315,125 3. New building bno a. P1,265,125 c. P1,027,800 b. P1,077,800 d. P1,056,800 30.4. Land Improvements a. P13,500 c. P63,500 d. P113,500 b. P50,000 CASE NO. 2: Assume that on the date of acquisition, the old building is unusable and has minimal fair value. P 14,000 12,000 PROBLEM 19-3 Capitalizable Cost of Land, Building and Improvements-Old Building Will Be Demolished On March 1, 2018, Romie Milan Co. acquired land and building by paui P9,000,000 and assuming a mortgage of P1,000,000. The old building demolished for the construction of a new building. 1 Unpaid real property taxes up to the date of acquisition 2 Cost of option of the acquired properties 20,000 Excavation cost Escrow fees on the properties acquired 11,000 5 Cost of relocating and reconstructing the property belonging to others in order to acquire the properties 23,000 006 Payment to real estate agent 40,000 7 Payments to tenants of the properties to induce them to vacate the premises. 3,000 8 Legal fees for contract to purchase the land 11,000 9 Cost of removing trees from the land 70,000 10 Building permit and licenses 60,000 0 11 Architect fee DO 12 Materials used in construction 600,000 13 Driveway and walk to building (part of building plan) 30,000 14 Payment for claim for injuries not covered by insurance 40,000 DO 15 Broker's fee on the properties acquired 10,000 00 16 Rental fees generated on the portion of the building being 0000used as a parking site OD 17 Cost of paving parking lot adjoining building 18 Other overhead cost incurred as result of construction 50,000 23,500 50,000 220,000 vice equipment and fixtures made a permanent part of the 19 Service equipme Questions: structure. Safety fence around construction site 11,000 Removal of safety fence 35,000 Demolition cost of the old building 9,800 Proceeds from salvage of the demolition 33,000 4,000 sed on the above data, determine the adjusted cost of the following: CASE NO. 1: Assume that on the date of acquisition, the land and building have fair values of P7,000,000 and P1,000,000 respectively. 1. Land a. P8,855,875 c. P8,936,875 b. P10,202,000 d. P10,265,500 2. The allocated cost of the old building that will be charged to loss. a. Nil c. P1,378,625 325 b. P1,265,125 d. P1,315,125 3. New building bno a. P1,265,125 c. P1,027,800 b. P1,077,800 d. P1,056,800 30.4. Land Improvements a. P13,500 c. P63,500 d. P113,500 b. P50,000 CASE NO. 2: Assume that on the date of acquisition, the old building is unusable and has minimal fair value