In 2017, Weisman Company had the following transactions related to the purchase of a property. All transactions are for cash unless otherwise stated.

Feb. 7 Purchased real estate for $575,000. paying $115,000 cash and signing a note pay-able (or the balance. The site had an old building on it and the fair value of the land and building were $555,000 and 530,000, respectively. Weisman intends to demolish the old building and construct a new apartment building on the site.

9 Paid legal fees of $7,500 on the real estate purchase on February 7.

15 Paid $19,000 to demolish the old building and make the land ready (or the construction of the apartment building.

17 Received S8500 from the sale of material from the demolished building.

25 Graded and filled the land in preparation for the building construction at a cost of $10,500. Mar. 2 Architect's fees on the apartment building were $28,000.

15 Excavation costs were 518,000. Construction began on March 20.

Aug. 31 The apartment building was completed. The full cost of construction was 5850.000. Paid $170,000 cash and signed a note payable for the balance.

Sept 3 Paid $40,000 for sidewalks and a parking lot for the building.

10 Purchased a one-year insurance policy on the finished building for $3,750.

Oct. 31 Paid $37,750 for landscaping.

Instructions

(a) Record the above transactions.

(b) Determine the cost of the land, land improvements, and building that will appear on Weisman's December 31, 2017, balance sheet.

Taking It Further

When should Weisman begin recording depreciation on this property and on which assets?