Which cost is not recorded as part of the cost of a building?
a. Real estate commission paid to buy the building
b. Construction materials and labor
c. Concrete for the building's foundation
d. Annual building maintenance
Which cost is not recorded as part of the cost of a building?
a. Real estate commission paid to buy the building
b. Construction materials and labor
c. Concrete for the building's foundation
d. Annual building maintenance
Related questions
The expenditures and receipts below are related to land, landimprovements, and buildings acquired for use in a businessenterprise. The receipts are enclosed in parentheses.
| (a) | Money borrowed to pay building contractor (signed a note) | $(282,800 | ) | ||
| (b) | Payment for construction from note proceeds | 282,800 | |||
| (c) | Cost of land fill and clearing | 11,770 | |||
| (d) | Delinquent real estate taxes on property assumed bypurchaser | 7,920 | |||
| (e) | Premium on 6-month insurance policy during construction | 11,460 | |||
| (f) | Refund of 1-month insurance premium because constructioncompleted early | (1,910 | ) | ||
| (g) | Architectâs fee on building | 26,160 | |||
| (h) | Cost of real estate purchased as a plant site (land $201,700and building $54,400) | 256,100 | |||
| (i) | Commission fee paid to real estate agency | 8,410 | |||
| (j) | Installation of fences around property | 4,280 | |||
| (k) | Cost of razing and removing building | 11,740 | |||
| (l) | Proceeds from salvage of demolished building | (5,090 | ) | ||
| (m) | Interest paid during construction on money borrowed forconstruction | 12,550 | |||
| (n) | Cost of parking lots and driveways | 20,330 | |||
| (o) | Cost of trees and shrubbery planted (permanent in nature) | 13,380 | |||
| (p) | Excavation costs for new building | 3,010 |
identify each item by letter and list the items in columnarform, using the headings shown below. All receipt amounts should bereported in parentheses. For any amounts entered in the OtherAccounts column, also indicate the account title.(Enter receipt amounts using either a negative signpreceding the number e.g. -45 or parentheses e.g. (45). If no entryis required in other accounts
| Item | Land | Land Improvements | Building | Other Accounts | ||||||
a
b
c
d
e
f
g
h
i
j
k
l
m
n
o
p
Venable Company was organized on January 1. During the first year of operations, the following plant asset expenditures and receipts were recorded in random order.
| Debit | ||||
| 1. | Cost of filling and grading the land | $ 4,500 | ||
| 2. | Full payment to building contractor | 680,500 | ||
| 3. | Real estate taxes on land paid for the current year | 4,500 | ||
| 4. | Cost of real estate purchased as a plant site (land $115,000 and building $46,500) | 161,500 | ||
| 5. | Excavation costs for new building | 35,500 | ||
| 6. | Architectâs fees on building plans | 12,500 | ||
| 7. | Accrued real estate taxes paid at time of purchase of real estate | 2,000 | ||
| 8. | Cost of parking lots and driveways | 13,500 | ||
| 9. | Cost of demolishing building to make land suitable for construction of new building | 26,000 | ||
| $940,500 | ||||
| Credit | ||||
| 10. | Proceeds from salvage of demolished building | $ 3,500 | ||
Analyze the foregoing transactions using the following column headings. Insert the amounts in the appropriate columns. (If an amount reduces the account balance then enter with a negative sign preceding the number, e.g. -15,000 or parenthesis, e.g. (15,000).)
| Item | Land | Buildings | Other Accounts | |||
| 1. | $ | $ | $ | |||
| 2. | ||||||
| 3. | ||||||
| 4. | ||||||
| 5. | ||||||
| 6. | ||||||
| 7. | ||||||
| 8. | ||||||
| 9. | ||||||
| 10. | ||||||
| $ | $ | |
