Plant Assets, Natural Resources, and Intar Problems Group B 6B Determining asset

ID: 2512350 • Letter: P

Question

Plant Assets, Natural Resources, and Intar Problems Group B 6B Determining asset cost and recording partial-year depreciation Safe Parking, near an airport, incurred the following costs to acquire land, make land improvements, and construct and furnish a small building P10-36B I Learning Objectiv 1. Bldg. $483,500 a. Purchase price of three acres of land b. Delinquent real estate taxes on the land to be paid by Safe Parking 86,000 6,300 8,400 3,400 9,600 900 20,100 Additional dirt and earthmoving C. d. Title insurance on the land acquisition Fence around the boundary of the property e. Building permit for the building f. g. Architect's fee for the design of the building h. Signs near the front of the property i. Materials used to construct the building j. 217,000 172,000 9,500 29,400 11,600 Labor to construct the building k. Interest cost on construction loan for the building I. Parking lots on the property m. Lights for the parking lots n. Salary of construction supervisor (80% to building: 20% to parking lot and concrete walks) o. Furniture p. Transportation of furniture from seller to the building q. Additional fencing 11,700 1,900 6,900 Safe Parking depreciates land improvements over 15 years, buildings over 40 years, and nture over 10 years, all on a straight-line basis with zero residual value. urements . Set up columns for Land, Land Improvements, Building,and Furniture Show houw to account tor eac h cost by listing the cost under the correct account. Determine the total cost of each asset. Record parti the nearest dollar ction was complete and the assets were placed in service on September 1. -year depreciation expense for the year ended December 31. Round to

Explanation / Answer

Sr No

Particulars

Land

Land Improvements

Building

Furniture

Total

Useful Life

Purchase of Three Acres of land

86000

Delinquent taxes on the land for safe parking

6300

Additional dirt and earth moving

8400

Title Insurance on the land acquisition

3400

Fence around the boundry of the property

9600

Building permit for the building

900

Architect fees for the building

20100

Signs in front of the property

9000

Material used to construct the building

217000

Labour to construct the building

172000

Interest cost on construction loan of the property

9500

Parking lots on the property

29400

Lights for the parking lots

11600

Saalry of Construction supervisor

80000

Furniture

11700

Transportation of furniture

1900

Additional Fencing

6900

Ans-1

Total Cost of Each Assets

89400

31200

549500

13600

683700

Ans-2

Dep for Half year

1040

6869

680