Lake Company recently incurred the following costs: (1) Purchaseprice of land and dilapidated building $250,000 (2) Real estatebrokerâs commission 14,000 (3) Net demolition costs of dilapidatedbuilding 39,000 (4) Excavation costs for new building 44,000 (5)Architectâs fees and building permits 30,000 (6) Costs associatedwith new building construction 750,000 (7) Costs associated withnew furniture and equipment 250,000 (8) Actual interest costsduring building construction 68,000 (9) Actual interest cost aftercompletion of building construction 120,000 (10) Costs of walks,driveways, and parking lot 55,000
1. The building should be recorded on Lakeâs books at a.$680,000. b. $724,000. c. $763,000. d. $892,000.
2 Land should be recorded on Lakeâs books at a. $250,000. b.$264,000. c. $303,000. d. $333,000.
Please explain how you got to the answers
Lake Company recently incurred the following costs: (1) Purchaseprice of land and dilapidated building $250,000 (2) Real estatebrokerâs commission 14,000 (3) Net demolition costs of dilapidatedbuilding 39,000 (4) Excavation costs for new building 44,000 (5)Architectâs fees and building permits 30,000 (6) Costs associatedwith new building construction 750,000 (7) Costs associated withnew furniture and equipment 250,000 (8) Actual interest costsduring building construction 68,000 (9) Actual interest cost aftercompletion of building construction 120,000 (10) Costs of walks,driveways, and parking lot 55,000
1. The building should be recorded on Lakeâs books at a.$680,000. b. $724,000. c. $763,000. d. $892,000.
2 Land should be recorded on Lakeâs books at a. $250,000. b.$264,000. c. $303,000. d. $333,000.
Please explain how you got to the answers
