On January 1, 2021, Blackstone Corporation purchased land (site number 11) with a building for $630,000. In addition, Blackstone paid a real estate broker's commission of $39,000, legal fees of $7,500, and title insurance of $19,500. The closing statement indicated that the value of the land was $515,000 and the value of the building was $115,000. Shortly after the acquisition, the building was demolished at a cost of $78,000. Blackstone entered into a $3,300,000 fixed price contract with Barnett Builders, Inc., on March 1, 2021, for the construction of an office building on Lot 11. The building was completed and occupied on September 30, 2022. The additional construction costs were incurred as follows: Plans, specifications and plans $15, 000 Architect Fees for Design and Supervision 87,000 To finance the cost of construction, Blackstone obtained a loan of $3,300,000 on March 1, 2021. The loan is repayable in 10 annual installments of $330,000 plus interest at a rate of 12%. Blackstone's average accrued building construction expense amounts were as below: 

For the period March 1 to December 31, 2021 $930,000 For the period January 1 to September 30, 2022 2,450,000

Required:

Prepare a schedule disclosing the individual costs that make up the balance in the land account with respect to the land site as of September 30, 2022.

Prepare a schedule that reveals the individual costs that must be capitalised in the office building account as of September 30, 2022.

Answer rating: 100% (QA)

Schedule of Costs for Land Account as of September 30 2022 Land Purchase Cost January 1 2021 Land Va... View the full answer