Rainbow Logistics purchased land with the intention of building an office. Rainbow also engaged other contractors for
Question:
Rainbow Logistics purchased land with the intention of building an office. Rainbow also engaged other contractors for fencing, paving, lighting, landscaping, and to remove a dilapidated building to make room for new office building.
The following information relates to these transactions:
Purchased land for $ 350,000.
Paid $ 4,000 for seller's back property taxes.
Paid $ 22,000 to have the dilapidated building removed.
Paid a builder $ 400,000 to design and build the office building.
Paid an excavation company $ 20,000 to grade and clear the land to make it suitable for building purposes.
Paid a landscaping company $ 10,000 for trees and shrubs.
Paid a contractor $ 16,000 for outside lighting around the parking area and sidewalks.
Paid $ 26,000 to have the parking lot paved.
Paid a fence builder $ 15,000 to construct a security fence around the property.
Instructions
Determine the cost of the land, the building, and the land improvements.
Expert Answer:
