McCoy's Fish House purchases a tract of land and an existing building for $920,000. The company...
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McCoy's Fish House purchases a tract of land and an existing building for $920,000. The company plans to remove the old building and construct a new restaurant on the site. In addition to the purchase price, McCoy pays closing costs, including title insurance of $2,200. The company also pays $12,400 in property taxes, which includes $8,200 of back taxes (unpaid taxes from previous years) paid by McCoy on behalf of the seller and $4,200 due for the current fiscal year after the purchase date. Shortly after closing, the company pays a contractor $46,000 to tear down the old building and remove it from the site. McCoy is able to sell salvaged materials from the old building for $3,400 and pays an additional $10,200 to level the land. Required: Determine the amount McCoy's Fish House should record as the cost of the land. (Amounts to be deducted should be indicated by a minus sign.) Purchase price of land Total cost of the land McCoy's Fish House purchases a tract of land and an existing building for $920,000. The company plans to remove the old building and construct a new restaurant on the site. In addition to the purchase price, McCoy pays closing costs, including title insurance of $2,200. The company also pays $12,400 in property taxes, which includes $8,200 of back taxes (unpaid taxes from previous years) paid by McCoy on behalf of the seller and $4,200 due for the current fiscal year after the purchase date. Shortly after closing, the company pays a contractor $46,000 to tear down the old building and remove it from the site. McCoy is able to sell salvaged materials from the old building for $3,400 and pays an additional $10,200 to level the land. Required: Determine the amount McCoy's Fish House should record as the cost of the land. (Amounts to be deducted should be indicated by a minus sign.) Purchase price of land Total cost of the land
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Cost of the land includes all costs incurred to put the l... View the full answer
Related Book For
Financial Accounting
ISBN: 978-0077862268
2nd edition
Authors: J. David Spiceland, Wayne Thomas, Don Herrmann
Posted Date:
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