Podcast
Questions and Answers
What is the total cost incurred by Kallisto for the purchase and preparation of the land and building?
What is the total cost incurred by Kallisto for the purchase and preparation of the land and building?
Which of the following expenses is NOT included in the total cost for the new plant?
Which of the following expenses is NOT included in the total cost for the new plant?
How much was spent on construction costs, including the new building and other related expenses?
How much was spent on construction costs, including the new building and other related expenses?
What journal entry should be made for the demolition cost of the old building?
What journal entry should be made for the demolition cost of the old building?
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What was the total amount paid for the land and building combined?
What was the total amount paid for the land and building combined?
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Study Notes
Land Costs
- Kallisto Backpack Manufacturing purchased land for $2,050,000.
- Demolition of the existing building cost $92,000.
- Land levelling cost $122,000.
Building Costs
- The price of the existing building was $650,000.
- Construction costs for the new building totalled $3,730,000, including $232,000 for parking lot improvements.
- Total building costs, including the building and parking lot features, amount to $4,380,000
Summary of Total Costs
- Total cost of land, including demolition and levelling is $2,264,000.
- Total cost of the new building, including parking lot, is $4,380,000.
- The combined total cost of land and building is $6,644,000.
Journal Entry (March 10, 2023)
- Debit Land: $2,264,000
- Debit Building: $4,380,000
- Credit Cash: $6,644,000
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Description
Test your knowledge on analyzing land and building costs with this quiz. Cover topics such as purchase prices, demolition, construction, and total cost summaries. This quiz is perfect for students in real estate or finance courses.
