Question

The following expenditures and receipts are related to land, land improvements, and buildings that were acquired for use in a business enterprise. The receipts are in parentheses.
1. Money borrowed to pay a building contractor (signed a note), ($275,000)
2. A payment for construction from note proceeds, $275,000
3. T he cost of landfill and clearing, $8,000
4. Delinquent real estate taxes on property, assumed by the purchaser, $7,000
5. A premium on a six-month insurance policy during construction, $6,000
6. Refund of one month's insurance premium because construction was completed early, ($1,000)
7. An architect’s fee on a building, $22,000
8. The cost of real estate purchased as a plant site (land $200,000; building $50,000), $250,000
9. A commission fee paid to a real estate agency, $9,000
10. T he installation of fences around a property, $4,000
11. The cost of razing (demolishing) and removing the building on the plant site (See 8), $11,000
12. Proceeds from the salvage of the demolished building, ($5,000)
13. Interest paid during construction on money borrowed for construction, $ 13,000
14. T he cost of parking lots and driveways, $19,000
15. The cost of trees and shrubbery that were planted (non-permanent in nature, to be replaced every 20 years), $ 14,000
16. Excavation costs for new building, $3,000
17. T he GST on the excavation cost, S150
Instructions
Identify each item by letter and list the items in columnar form, as shown below. Using the column headings that follow, write the number for each item in the first colwnn and its amount under the column heading where it would be recorded. All receipt amounts should be reported in parentheses. For any an10unts that should be entered in the Other Accounts column, also indicate the account title.


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  • CreatedSeptember 18, 2015
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