Pierce Systems purchased land, paying $90,000 cash as a down payment and signing
ID: 2563694 • Letter: P
Question
Pierce Systems purchased land, paying $90,000 cash as a down payment and signing a $260,000 note payable for the balance. In addition, Plerce Systems paid delinquent property tax of $2,500, title insurance costing $5,500, and a $12,100 charge for leveling the land and removing an unwanted building. The company constructed an office building on the land at a cost of $750,000. It also paid $55,000 for a fence around the property, $9,000 for the company sign near the entrano and $10,000 for special lighting of the grounds 1. Determine the cost of the company's land, land improvements, and building. 2. Which of the assets will Pierce depreciate? Requirement 1. Determine the cost of the company's land, land The cost of the land is $ The cost of the building is $ Requirement 2. Which of the assets will Pierce depreciate? Enter any number in the edit fields and then continue to the nextExplanation / Answer
Pierce Systems
Cost of land –
Down payment made $90,000
Notes payable for remaining $260,000
Delinquent property tax $2,500
Title Insurance $5,500
Cost of leveling land and removing unwanted building $12,100
Total cost of land $370,100
Total cost of land improvements –
Cost of fencing $55,000
Cost of Company sign $9,000
Cost of special lighting $10,000
Total Cost of land improvements $74,000
Cost of building –
Construction cost of building $750,000
Land is not a depreciable asset.