Merchant Company purchased property for a building site. The costs associated with the property were: Purchase...

 

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Merchant Company purchased property for a building site. The costs associated with the property were: Purchase price Real estate commissions Legal fees Expenses of clearing the land Expenses to remove old building $ 185,000 16,000 1,800 3,000 2,000 What portion of these costs should be allocated to the cost of the land and what portion should be allocated to the cost of the new building? Merchant Company purchased property for a building site. The costs associated with the property were: Purchase price Real estate commissions Legal fees Expenses of clearing the land Expenses to remove old building $ 185,000 16,000 1,800 3,000 2,000 What portion of these costs should be allocated to the cost of the land and what portion should be allocated to the cost of the new building?

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