In 2012, Westlake Ltd. had the following transactions related to the purchase of property. Assume all transactions

Feb. 7 Purchased real estate for $550,000, paying $150,000 cash and signing a mortgage payable for the balance. The site had an old building on it and the fair values of the land and building were $500,000 and $50,000, respectively. Westlake intends to construct an apartment building on the site.

9 Paid legal fees of $11,000 on the real estate purchase of February 7.

15 Paid $30,000 to demolish the old building and make the land ready for the construction of the apartment building.

17 Received $8,000 from the sale of material from the demolished building.

Mar. 2 Paid architect fees on the apartment building of $36,000.

July 5 The full cost for construction of the apartment building was $1.3 million. Paid $340,000 cash and signed a bank loan payable for the balance.

Aug. 22 Paid $24,000 for sidewalks and a parking lot for the building.

Sept. 1 Purchased a one-year insurance policy on the finished building for $5,000.

Instructions

(a) Record the transactions.

(b) Determine the cost of the land, land improvements, and building that will appear on Westlake's December 31, 2012, statement of financial position.

(c) When would depreciation begin on the items recorded above?

(d) Under IFRS, could the company adopt a model that does not require depreciation? Under ASPE?