Use Part 3 of the Assessment 3 Template to record your answers.

Assessment 3 Acquisition Costs of Realty Problem Sheet The following expenditures and receipts are related to land, land improvements, and buildings acquired for use in a business enterprise. The receipts are enclosed in parentheses: (a) Money borrowed to pay building contractor (signed a note) (b) Payment for construction from note proceeds $(137,500) 137,500 (c) Cost of land fill and clearing 4,000 (d) Delinquent real estate taxes on property assumed by purchaser 3,500 (e) Premium on 6-month insurance policy during construction 3,000 (f) Refund of 1-month insurance premium because construction completed early (g) Architect's fee on building (500) 11,000 (h) Cost of real estate purchased as a plant site (land $100,000 and building $25,000) 125,000 (i) Commission fee paid to real estate agency 4,500 (j) Installation of fences around property 2,000 (k) Cost of razing and removing building 5,500 (l) Proceeds from salvage of demolished building (2,500) (m) Interest paid during construction on money borrowed for construction 6,500 (n) Cost of parking lots and driveways 9,500 (o) Cost of trees and shrubbery planted (permanent in nature) 7,000 (p) Excavation costs for new building 1,500 Using the appropriate section in the Assessment 3 Template, identify each item by letter and list the items in columnar form. All receipt amounts should be reported in parentheses. For any amounts entered in the Other Accounts column, also indicate the account title. Where appropriate, show all calculations leading to the final solution. 1 Assessment 3 Template Use this template to record your answers to Parts 1-4 in Assessment 3. Submit the completed template for your assessment. Part 1: Receivables Reporting Problem 1 Problem 2 Problem 3 Problem 4 Problem 5 Part 2: Inventory Issues Problem 1 Problem 2 Problem 3 Because no date was associated with the units issued or sold, the periodic (rather than perpetual) inventory method must be assumed. FIFO inventory cost: LIFO inventory cost: 1 Assessment 3 Template Average-cost: Totals Ending inventory 2 Assessment 3 Template Part 2 (Continued) Problem 4 Computation of price indexes: 12/31/15 12/31/16 Dollar-value LIFO inventory 12/31/15: Dollar-value LIFO inventory Dollar-value LIFO inventory 12/31/16: Dollar-value LIFO inventory 3 Assessment 3 Template Part 2 (Continued) Problem 5 The inventoriable costs for 2016 are: Inventoriable cost.......................................................................... Note: Freight-out is a selling expense. Interest on notes payable is a period expense. Neither is an inventoriable cost. Part 3: Acquisition Costs of Realty Land Item Land Improvements Building Other Accounts (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) (m) (n) (o) (p) 4 Assessment 3 Template Part 4 a) 1. Depreciable Base Computation: 2. Sum-of-the-years'-digits for 2015 3. Double-declining balance for 2015 b) 5