Chapter 7 Homework Submit your answers in CANVAS before it is due Use the following to answer questions 1-4 JT Company purchased land as a factory site. An old building on the property was demolished, and construction began on a new building. Costs incurred during the first year are listed below: Land purchased as a factory site $500,000 Building construction costs 2,500,000 Interest cost related to the construction. 50,000 Demolition of old building 40,000 Title investigation of land 7,000 Property taxes on land (for the next year) 5,000 36,500 7,000 Architect fees (for new building) Sale of salvaged materials 1. S account? How much of the "property taxes on the land for the next year" should be capitalized in the Land 2. How should the "sale of salvaged materials" be recorded? 3. $ A. As an added cost of the land B. As a reduction of the cost of the land C. As an added cost to the building D. As a reduction of the cost of the building What amount should be recorded to the Land account? 4. S What amount should be recorded to the Building account