In 2018, Kilroy Company purchased land for a new office building at a purchase price of $325,000. There was an existing building on the site that was demolished at a cost of $12,000. Scrap from the demolition was sold for $3,500. The building was completed during 2018. In addition, the following costs were incurred: Professional Fees: Attorneys for the purchase contract $ 7,500 Engineers to determine the required grading $ 18,000 Architects to design new building $ 40,000 Building permits $ 8,000 Construction of new building $ 1,275,000 In Kilroy’s December 31, 2018, financial statements, how will the above costs be reported? 

        Land               Building       Expense 

a.   $ 341,000   $ 1,323,000    $ 0 

b. $ 351,500    $ 1,315,000     $ 15,500 

c. $ 359,000    $ 1,323,000     $ 0 

d. $ 333,500   $ 1,275,000     $ 73,500

Answer rating: 100% (QA)

Total cost of land Purchase cost Demolition Cost Cost of Att... View the full answer