Problem 7-1B Determine the acquisition cost of land and building (LO7-1)

The Italian Pizza Company purchased land as a factory site for $85,000. Prior to construction of the new building, the land had to be cleared of trees and brush. Construction costs incurred during the first year are listed below:

Land clearing costs	$	4,500
Sale of firewood to a worker		(450	)
Architect fees (for new building)		25,000
Title investigation of land		3,000
Property taxes on land (for the first year)		2,500
Building construction costs		350,000

Required:

Determine the amounts that the company should record in the land and the new building accounts. (Amounts to be deducted should be indicated by a minus sign.)