House Builders of Canada decided to expand its facilities and upgrade some of its log preparation equipment.
Question:
Required:
a. Determine the costs that should be capitalized as assets by Home Builders of Canada in its land, buildings, and equipment accounts.
b. State what should be done with any of the costs that are not capitalized.
Transcribed Image Text:
Date Amount Description of Expenditure Purchased land adjacent to the company's existing property, to he used for the expansion Jan. 2 75,000 ,200 Paid leal fees and deed registration fees. 4,000 Paid its workers to clear the land on their days off. 15 17 20 120,000 Purchased equipment, which was delivered but not yet paid for. 900 Purchased building permit for construction of the addition 2.500 Constructed temporary fencing as required by the building permit to enclose the construc- tion site. Upon completion of the addition to the building, the fencing was to be removed. Started construction of a new addition to the main building, which is estimated to cost $400,000 Received bill for delivery of the equipment that was received onJanuary 15 Paid the amounts owing on the equipment and its delivery. 22 400,000 25 Feb. 1 3,500 28 1,000 Paid architect's fees for designing the building addition and supervising its construction. May 9 380,000 Pil amount to the construction company upon completion of the building. 800 2,500 1.200 700 200 Paid cost to remove temporary fencing. Paid work crews to install the equipment. Paid for party to celebrate the successful completion of the expansion. Paid for set-up and adjustment of the new equipment so it would be ready to use. Paid for an ad in the local paper to advertise that the company was hiring. 14 24 June 7 I0
Fantastic news! We've Found the answer you've been seeking!
Step by Step Answer:
Answer rating: 75% (12 reviews)
a Amount to be capitalized Land Building Equipment Jan 2 Purchase of land 75000 Jan 6 Fees ...View the full answer
Answered By
Bhartendu Goyal
Professional, Experienced, and Expert tutor who will provide speedy and to-the-point solutions. I have been teaching students for 5 years now in different subjects and it's truly been one of the most rewarding experiences of my life. I have also done one-to-one tutoring with 100+ students and help them achieve great subject knowledge. I have expertise in computer subjects like C++, C, Java, and Python programming and other computer Science related fields. Many of my student's parents message me that your lessons improved their children's grades and this is the best only thing you want as a tea...
3.00+
2+ Reviews
10+ Question Solved
Related Book For
Understanding Financial Accounting
ISBN: 978-1118849385
1st Canadian Edition
Authors: Christopher Burnley, Robert Hoskin, Maureen Fizzell, Donald
Question Posted:
Students also viewed these Accounting questions
-
The following events occurred during the year ended 30 June 2020 for Electrical Limited. On 1 June 2020, Electrical Ltd. signed a three-month 9% per annum bills payable to purchase a new equipment...
-
The following events occurred during 2011 for various audit clients of your firm. Consider each event to be independent and the effect of each event to be material. 1. A manufacturing company...
-
The following events occurred during 2018 for Frames Unlimited: 1. Purchased inventory for $60,000 in cash. 2. Recorded $40,000 in insurance expense for the portion of an insurance policy acquired in...
-
Valuing Preferred Stock Best Rate Bank just issued some new preferred stock. The issue will pay a $10 annual dividend in perpetuity, beginning 10 years from now. If the market requires a 7 percent...
-
Exclusion of Gain from Small Business Stock. In 1996, Jose acquired 100% of Acorn Corporation common stock by transferring property with an adjusted basis of $1,000,000 and fair market value of...
-
In order for her to get the data she needs, people will have to make comments on Sarahs film-tourism blog. How will Sarah ensure that people know about and find her blog so that they can keep posting...
-
What are the four advantages of private equity funds? How do they help alleviate the free-rider problem?
-
Allen Paper Co. produces the paper used by wallpaper manufacturers. Allens four-stage process includes mixing, cooking, rolling, and cutting. During March, the Mixing Department started and completed...
-
In the process of saving some money for my kids college I plan to make six annual deposits of $4000 into a secret savings account that pays an interest of 4% compounded annually. Two years after...
-
Williams Technology (WT) is a private corporation formed in 2006. WT develops and sells software for many purposes: theft recovery, geo-mapping, data and device security, and IT asset management. To...
-
Jijang Excavations Ltd. (JEL) operates specialized equipment for installing natural gas pipelines. JEL, which has a December 31 year end, began 2016 with a single piece of equipment that had been...
-
On July 1, 2012, Steelman Company acquired a new machine for $140,000 and estimated it would have a useful life of 10 years and residual value of $7,000. At the beginning of 2015, the company decided...
-
Look up General Mills (GIS), Kellogg (K), Campbell Soup (CPB), and Seneca Foods (SENEA). a. What are the current P/E and P/B ratios for these food companies? What are the dividend and dividend yield...
-
Conversely, what expenses are shown on your cash flow statement and not in your P&L? Why are they different?
-
Would it be more difficult to defend a client in a civil or criminal trial?
-
what was the cause of tacony bridge collapsing in 1 9 4 0
-
Homer and Marge were married in 1980 and had two children, Bart and Lisa. In 2010 they were on the verge of seeking a divorce. Homer had been not living in the home for the past two years. According...
-
What is a safety net provider? Why are they important to both the people they serve and the organizations that are not safety-net providers? Please provide examples and reasoning for your answer.?
-
The authors mention that hunter-gatherers use sophisticated sign language (line 34) primarily in order to A) Refute a common misconception about hunter-gatherers. B) Specify the mechanism by which...
-
A glass manufacturer produces hand mirrors. Each mirror is supposed to meet company standards for such things as glass thickness, ability to reflect, size of handle, quality of glass, color of...
-
(a) Determine the ending inventory under the conventional retail method for the ?furniture department of Mayron Department Stores from the following data (amounts ?in thousands). (b) If the results...
-
(a) Determine the ending inventory under the conventional retail method for the ?furniture department of Mayron Department Stores from the following data (amounts ?in thousands). (b) If the results...
-
(a) Determine the ending inventory under the conventional retail method for the ?furniture department of Mayron Department Stores from the following data (amounts ?in thousands). (b) If the results...
-
Could someone explain how to respond to the question below in an educated manner? Thank you for taking the time to answer my questions. In most training sessions, participants enter with different...
-
Thus far, we have assumed that each value has equal weight, or importance, but that is not always the case. Suppose a stock is expected to have a return of either 2%, 8%, or 35%. The simple,...
-
Pick a topic that interests you in informatics and design a study to evaluate it as outlined below. A carefully designed study can yield significant results; a poorly designed one will have little or...
Study smarter with the SolutionInn App