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Required information [The following information applies to the questions displayed below.] On January 1, Mitzu Company pays a lump-sum amount of $2,700,000 for land, Building
Required information [The following information applies to the questions displayed below.] On January 1, Mitzu Company pays a lump-sum amount of $2,700,000 for land, Building 1. Bullding 2, and Land Improvements 1. Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $590,000, with a useful life of 20 years and a $75,000 salvage value. Land Improvements 1 is valued at $590,000 and is expected to last another 20 years with no salvage value. The land is valued at $1,770,000. The company also incurs the following additional costs. Cost to demolish Bullding 1 Cost of additional land grading Cost to construct Building 3 , having a useful 1 ife of 25 years and a {400, 000 salvage value cost of new Land Improveents 2 , havine a 20 -year useful Iife and no salvage value \& 346,400 191,400 2,242,000 178,000
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