Pollachek Co. purchased land as a factory site for $508,500. The process of tear

Question

Pollachek Co. purchased land as a factory site for $508,500. The process of tearing down two old buildings on the site and constructing the factory required 6 months. The company paid $47,460 to raze the old buildings and sold salvaged lumber and brick for $7,119. Legal fees of $2,091 were paid for title investigation and drawing the purchase contract. Pollachek paid $2,486 to an engineering firm for a land survey, and $73,450 for drawing the factory plans. The land survey had to be made before definitive plans could be drawn. Title insurance on the property cost $1,695, and a liability insurance premium paid during construction was $1,017. The contractor

Explanation / Answer

Hi,

Please find the answers as follows:

Land = 508500 + 47460 - 7119 + 2091 + 1695 = 552627

Building = 2486 + 73450 + 1017 + 1356000 + 1740200 + 192100 = 3365253

Thanks.

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