Mooney Sounds, a local stereo retailer, needed a new store because it had outgrown the leased space it had used for several years. Mooney acquired and remodeled a former grocery store. As a part of the acquisition, Mooney incurred the following costs:

Required:
1. Determine the cost of the land and the building.
2. Conceptual Connection: If management misclassified a portion of the building€™s cost as part of the cost of the land, what would be the effect on the financial statements?

$277 400 e and electrical supplies $ 4,290 6,400 3,850 12,500 Cost of grocery store Cost of land (on which the New doors grocery store is locatec) New roof for building Lumber used for remodeling Paint 83,580 New windows 74,000 23,200 Wages paid to workers for remodeling Additional inventory purchased for 515 grand opening sale 45,300