Twenty years ago Sigurdson Corp. purchased an office building in Oslo for 12 million Norwegian kroner (Kr), 4 million of which was attributable to land. Sigurdson has fully paid off the mortgage. The current balance sheet follows (in millions):

Cash			Kr	3.0		Stockholders' equity	Kr	8.3
Land				4.0
Building at cost	Kr	8.0
Accumulated depreciation		6.7
Book value				1.3
Total assets			Kr	8.3

The company is about to borrow Kr 18 million on a first mortgage to modernize and expand the building. This amounts to 60% of the Kr 30million appraised value of the combined land and building before the modernization and expansion.

Requirements

1.

Prepare a balance sheet after Sigurdson Corp. obtains the loan and expands and modernizes the building, but before it charges any further depreciation.

Requirement 1. Prepare a balance sheet after

SigurdsonSigurdson

Corp. obtains the loan and expands and modernizes the building, but before it charges any further depreciation.

	Save Accounting Table...			+
	Copy to Clipboard...			+

Cash			Kr	( )		Mortgage payable	Kr	()
Land				( )		Stockholders' equity		( )
Building at cost	Kr	( )
Accumulated depreciation	( )
Book value			( )
Total assets			Kr()			Total liabilities and stockholders' equity	Kr	()