On February 12, Laker Company purchased a tract of land as a factory site for $175,000. An existing building on the property was razed and construction was begun on a new factory building in March of the same year. Additional data are available as follows: Cost of razing old building .......................... $ 35,000 Title insurance and legal fees to purchase land ...... 12,500 Architect's fees ..................................... 42,500 New building construction cost ....................... 875,000 The recorded cost of the completed factory building should be a. $910,000. b. $917,500. c. $930,000. d. $952,500.

On February 12, Laker Company purchased a tract of land as a factory site for $175,000. An existing building on the property was razed and construction was begun on a new factory building in March of the same year. Additional data are available as follows: Cost of razing old building .......................... $ 35,000 Title insurance and legal fees to purchase land ...... 12,500 Architect's fees ..................................... 42,500 New building construction cost ....................... 875,000 The recorded cost of the completed factory building should be a. $910,000. b. $917,500. c. $930,000. d. $952,500.

CONCEPTS IN FED.TAX.,2020-W/ACCESS

20th Edition

ISBN:9780357110362

Author:Murphy

Publisher:Murphy

Chapter9: Acquisitions Of Property

Section: Chapter Questions

Problem 46P

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