Question

What costs are land?

instructure.com/course/9534/sognment/129361 Show Attempt History Current Attempt in Progress X Your answer is incorrect On March 1, 2017, Blossom Company acquired real estate on which it planned to construct a small office building by paving $75.000 in cash. An old warehouse on the property was demolished at a cost of $7.200, the salvaged materials were sold for $1.500. Additional expenditures before construction began included $1.000 attorney's fee for work concerning the land purchase 54,000 real estate brokersfee, 58.500 architect's fee, and $13,000 to put in driveways and a parking lot (a) Determine the amount to be reported as the cost of the land. Cost of land $ 106200 e Textbook and Media Attempts: 3 of 5 used o e

Answer 1

(a) Cost of land = Cash paid + Net cost of removing warehouse + Attorney’s fee + Real estate broker’s fee

Cost of land = $75,000 + ($7,200 – $1,500) + $1,000 + $4,000

Cost of land = $85,700