On January 1, Mitzu Co. pays a lump-sum amount of $2,650,000 for land, Building 1, Building 2, and Land Improvements Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $540,000, with a useful lif of 20 years and a $80,000 salvage value. Land Improvements 1 is valued at $600,000 and is expected to last another 20 years with no salvage value. The land is valued at $1,860,000. The company also incurs the following additional costs Cost to demolish Building 1 Cost of additional land grading Cost to construct Building 3, having a useful life of 25 years and a $402,000 salvage value Cost of new Land Improvements 2 having a 20-year useful life and no salvage value $343,400 187,400 Wiew transaction list 2,302,000 168,000 repare a single journal entry to record all the incurred costs assuming they are paid in cash on January 1

On January 1, Mitzu Co. pays a lump-sum amount of $2,650,000 for land, Building 1, Building 2, and Land Improvements Building 1 has no value and will be demolished. Building 2 will be an office and is appraised at $540,000, with a useful lif of 20 years and a $80,000 salvage value. Land Improvements 1 is valued at $600,000 and is expected to last another 20 years with no salvage value. The land is valued at $1,860,000. The company also incurs the following additional costs Cost to demolish Building 1 Cost of additional land grading Cost to construct Building 3, having a useful life of 25 years and a $402,000 salvage value Cost of new Land Improvements 2 having a 20-year useful life and no salvage value $343,400 187,400 Wiew transaction list 2,302,000 168,000 repare a single journal entry to record all the incurred costs assuming they are paid in cash on January 1

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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