The owner of Cheetle Moving and Storage incurred the following costs in acquiring land, making land improvements, and constructing and furnishing the company's office building in the year ended December 31, 2017:
a. Purchase price of 4 hectares of land, including an old building that will be used for a garage (land appraised market value is $450,000; building appraised market value is $50,000)..........$ 400,000
b. Additional dirt and earth moving......................................................................8,000
c. Fence around the boundary of the land.............................................................25,000
d. Legal fee for title search on the land..................................................................2,000
e. Real estate taxes in arrears on the land to be paid by Cheetle Moving and Storage............4,800
f. Company signs at front of the company property....................................................4,000
g. Building permit for the office building...............................................................2,000
h. Architect fee for the design of the office building................................................75,000
i. Masonry, carpentry, roofing, and other labour to construct office building..................850,000
j. Concrete, wood, steel girders, and other materials used in the construction
of the office building...................................................................................650,000
k. Renovation of the garage.............................................................................30,000
l. Flowers and plants.....................................................................................15,000
m. Parking lot and concrete walks on the property..................................................48,500
n. Lights for the parking lot, walkways, and company signs.......................................14,500
o. Salary of construction supervisor (95 percent to office building and 5 percent
to garage renovation)..................................................................................100,000
p. Office furniture for the office building..........................................................160,000
q. Transportation and installation of office furniture................................................2,500
Cheetle Moving and Storage amortizes buildings over 35 years, land improvements over 15 years, and furniture over 5 years, all on a straight-line basis with zero residual value.
Required
1. Set up columns for Land, Land Improvements, Office Building, Garage Building, and Furniture. Show how to account for each of Cheetle Moving and Storage's costs by listing the cost under the correct account. Determine the total cost of each asset.
2. Assuming that all construction was complete and the assets were placed in service on June 30, record amortization for the year ending December 31, 2017. Round figures to the nearest dollar.