A company purchased a track of land with the intent to use the land to put a new building. However, an old building is sitting where the new building is to be constructed, and the old building must be removed at a cost of $10,000. Should the cost of removing the old building be part of the cost of the building or be part of the cost of the land? Please explain:
A company purchased a track of land with the intent to use the land to put a new building. However, an old building is sitting where the new building is to be constructed, and the old building must be removed at a cost of $10,000. Should the cost of removing the old building be part of the cost of the building or be part of the cost of the land? Please explain:
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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A company purchased a track of land with the intent to use the land to put a new building. However, an old building is sitting where the new building is to be constructed, and the old building must be removed at a cost of $10,000. Should the cost of removing the old building be part of the cost of the building or be part of the cost of the land? Please explain:
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