Larkspur Brothers Inc. purchased land and an old building with the intention of removing the old building and then constructing the company's new corporate headquarters on the land. The land and old building were purchased for $580,000. Closing costs were $5,610. The old building was removed at a cost of $47,200. After readying the land for its intended use, and while waiting for construction to begin, Larkspur generated net revenue of $4,740 from using the land as a parking lot. Determine the amount to be recorded as the land cost, and the treatment of the net revenue of $4,740, if Larkspur prepares financial statements in accordance with (a) IFRS and (b) ASPE. Land cost $ IFRS The net revenue of $4,740 should be $ ASPE IFRS ASPE Capitalized and credited to Buildings account Recognized as income when earned

Larkspur Brothers Inc. purchased land and an old building with the intention of removing the old building and then constructing the company's new corporate headquarters on the land. The land and old building were purchased for $580,000. Closing costs were $5,610. The old building was removed at a cost of $47,200. After readying the land for its intended use, and while waiting for construction to begin, Larkspur generated net revenue of $4,740 from using the land as a parking lot. Determine the amount to be recorded as the land cost, and the treatment of the net revenue of $4,740, if Larkspur prepares financial statements in accordance with (a) IFRS and (b) ASPE. Land cost $ IFRS The net revenue of $4,740 should be $ ASPE IFRS ASPE Capitalized and credited to Buildings account Recognized as income when earned

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 7PB: Tree Lovers Inc. purchased 2,500 acres of woodland in which it intends to harvest the complete...

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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?
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