ABC Corp purchased land and building at a lump price of P6M. ABC demolished the building and constructed a new one. Cost of demolition is P30,000 and sold salvaged materials from the demolished building for P7,500. ABC also incurred the following additional costs: Legal fees in titling the land, P10,000 Options paid for the land and building, P3,000 Payment to tenants to vacate the place, P6,000 Construction materials, labor and overhead P4,250,000 Fair values of the land and building were P2.5M and P5M respectively. How much is the cost of the land and old building? 2,000,000 and 4,000,000 2,000,000 and 4,002,000 2,013,000 and 4,006,000 2,033,000 and 4,016,000

ABC Corp purchased land and building at a lump price of P6M. ABC demolished the building and constructed a new one. Cost of demolition is P30,000 and sold salvaged materials from the demolished building for P7,500. ABC also incurred the following additional costs: Legal fees in titling the land, P10,000 Options paid for the land and building, P3,000 Payment to tenants to vacate the place, P6,000 Construction materials, labor and overhead P4,250,000 Fair values of the land and building were P2.5M and P5M respectively. How much is the cost of the land and old building? 2,000,000 and 4,000,000 2,000,000 and 4,002,000 2,013,000 and 4,006,000 2,033,000 and 4,016,000

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter10: Property, Plant And Equipment: Acquisition And Subsequent Investments

Section: Chapter Questions

Problem 3RE: Utica Corporation paid 360,000 to purchase land and a building. An appraisal showed that the land is...

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Utica Corporation paid 360,000 to purchase land and a building. An appraisal showed that the land is worth 100,000 and the building is worth 300,000. What cost should Utica assign to the land and to the building, respectively?
ABC Corp purchased land and building at a lump price of P6M. ABC demolished the building and constructed a new one. Cost of demolition is P30,000 and sold salvaged materials from the demolished building for P7,500. ABC also incurred the following additional costs: Legal fees in titling the land, P10,000 Options paid for the land and building, P3,000 Payment to tenants to vacate the place, P6,000 Construction materials, labor and overhead P4,250,000 Fair values of the land and building were P2.5M and P5M respectively. How much is the cost of the NEW building? a. 8278500 b. 4280000 c.4272500 d.4250000
ABC Corp purchased land and building at a lump price of P6M. ABC demolished the building and constructed a new one. Cost of demolition is P30,000 and sold salvaged materials from the demolished building for P7,500. ABC also incurred the following additional costs: Legal fees in titling the land, P10,000 Options paid for the land and building, P3,000 Payment to tenants to vacate the place, P6,000 Construction materials, labor and overhead P4,250,000 Fair values of the land and building were P2.5M and P5M respectively. How much is the cost of the NEW building? 8,278,500 4,280,000 4,272,500 4,250,000
Health Co. purchased land and building at a lump-sum price of P6,000,000. After the acquisition, Health Co. demolished the existing building and started the construction of a new one. Health Co. incurred P30,000 in razing the old structure.Materials salvaged from the demolition were sold for P7,500. Heatlh incurred the following additional costs: Legal fees in conveying title to land 10,000 Option paid for the land and old building acquired 3,000 Payments to tenants to vacate premises 6,000 Materials, labor and construction overhead incurred in the construction of the new building 4,250,000 Case 1: The land and old building have fair values of P2,500,000 and P5,000,000, respectively. Requirements: Allocate the costs. Provide the journal entries. Case 2: The old building is unusable and has an insignifacant fair value. Requirements: Allocate the costs. Provide the journal entries.
ABC Corp purchased land and building at a lump price of P6M. ABC demolished the building and constructed a new one. Cost of demolition is P30,000 and sold salvaged materials from the demolished building for P7,500. ABC also incurred the following additional costs: Legal fees in titling the land, P10,000 Options paid for the land and building, P3,000 Payment to tenants to vacate the place, P6,000 Construction materials, labor and overhead P4,250,000 Fair values of the land and building were P2.5M and P5M respectively. How much is the cost of the NEW building? PPE intermediate accounting
Asura Co. purchased land and building for a lump-sum price of P48,000,000. The existing building will be demolished and a new building will be constructed. Asura incurred the following additional costs: Title guarantee 80,000 Option paid for the land and old building acquired 24,000 Payments to tenants to vacate premises 48,000 Cost of razing the old building 240,000 Construction cost of new building (completed) 34,000,000 The land and old building have fair values of P20,000,000 and P40,000,000, respectively. Some salvaged wood planks from the demolition were used as wall panels in the new building. Asura estimates that the salvaged wood planks have a fair value of P120,000. The other salvaged materials were sold for P60,000. How much is the allocated cost of the old building? Answer:
Buko Co. purchased land and building by paying P5,000,000 and assuming a mortage of P1,000,000.The land and building have fair values of P2,500,000 and P5,000,000 , respectively Buko Co. will use the buildings as its new office. Buko Co. also incurred the following costs: Land registration costs 4,000 Payment to tenants to vacate premises 4,500 Option paid on the land and building 3,000 Option paid on similar land and building not acquired 1,500 Broker’s fee on the land and building 7,500 Unpaid real estate taxes prior to acquisition date assumed by Buko Co. -assessed on land 15,000 Real estate taxes after April 1, 20x1 10,000 Repairs and renovation costs before the building is occupied 20,000 Repair costs after the building is occupied 25,000
Old Room Co. purchased land and building for a lump-sum price of $48,000,000. The existing building will be demolished and a new building will be constructed. Old Room incurred the following additional costs: Title guarantee 80,000 24,000 Option paid for the land and old building acquired Payments to tenants to vacate premises 48,000 Cost of razing the old building 240,000 Construction cost of new building (completed) 34,000,000 The land and old building have fair values of $20,000,000 and $40,000,000, respectively. • Some salvaged wood planks from the demolition were used as wall panels in the new building. Old Room estimates that the salvaged wood planks have a fair value of $120,000. The other salvaged materials were sold for $60,000. How much are the allocated costs of the land and the new building? 16,864,000 (Land) 33,780,000 (New Building) 16,104,000 (Land) 34,180,000 (New Building) 15,980,000 (Land) 36,670,000 (New Building) 16,104,000 (Land) 34,810,000 (New Building)
Gamjatang Inc. acquired a land and an old unusable building for P7,500,000. Gamjatang contracted Busan Contractors to construct a new building with a total contract price of P10,850,000. Architect fees paid was P473,000. Gamjatang incurred costs to demolish the old unusable building of P288,000. Proceeds from scrap materials from the old building was P22,000. How much is the cost of land?
Samyang Inc. acquired a land and an old unusable building for P7,500,000. Samyang contracted Busan Contractors to construct a new building with a total contract price of P10,850,000. Architect fees paid was P473,000. Samyang incurred costs to demolish the old unusable building of P288,000. Proceeds from scrap materials from the old building was P22,000. How much is the cost of land?
Old Room Co. purchased land and building for a lump-sum price of ₱48,000,000. The existingbuilding will be demolished and a new building will be constructed. Old Room incurred thefollowing additional costs: Title guarantee 80,000 Option paid for the land and old building acquired 24,000 Payments to tenants to vacate premises 48,000 Cost of razing the old building 240,000 Construction cost of new building (completed) 34,000,000 The land and old building have fair values of ₱20,000,000 and ₱40,000,000, respectively. • Some salvaged wood planks from the demolition were used as wall panels in the new building. OldRoom estimates that the salvaged wood planks have a fair value of ₱120,000. The other salvagedmaterials were sold for ₱60,000.• The old building is unusable and has an insignificant fair value.How much are the allocated costs of the land and the new building?Land New buildinga. 46,104,000…
Wellsley Corporation purchased an old building and the land on which it is located for $70,000. The old building was demolished at a cost of $20,500. The new building that was built on the site cost $250,000. Wellsley also incurred the following costs: closing fees including commissions of $4,500, and title insurance costing $3,000. What is the correct amount to capitalize for the Land? a) $70,000 Ob) $90,500 c) $320,000 d) $98,000 e) $418,000