Acc205 Principles of Accounting:  P9-27A Drive and Fly, near an airport, incurred

Acc205 Principles of Accounting: P9-27A Drive and Fly, near an airport, incurred

Acc205 Principles of Accounting

P9-27A Capitalized asset cost and partial year depreciation
Drive and Fly, near an airport, incurred the following cost to acquire land, make land improvements, and construct and furnish a small building:
a. Purchase price of 3 acres of land 80,000
b. Delinquent real estate taxes on the land to be paid by Drive and fly 5,600
c. Additional dirt and earth moving 9,000
d. Title insurance on the Land acquisition 3,200
e. Fence around the boundary of the property 9,100
f. Building permit for the building 500
g. Architect fee's for the design of the building 20,700
h. Sign near the front of the property 9,000
i. Material used to construct the building 215,000
j. Labor to construct the building 173,000
k. Interest cost on construction loan for the building 9,500
l. Parking lot on the property 29,000
m. Lights for the parking lots 11,300
n. Salary for the construction supervisor (80% to the building
20% to the parking lot and concrete walks) 80,000
o. Furniture 11,600
p. Transportation of furniture from seller to the building 2,200
q. Landscaping ( shrubs) 6,300
Drive and fly depreciates land improvement over 20 years, buildings over 40 years, and furniture over 10 years, all on a straight-line basis with zero residual value.

Requirements:
1. Set up columns for land, land improvements, building, and furniture. Show how to account for each cost by listing the cost under the correct account; determine the total cost of asset.
2. All construction was complete and the assets were placed in service on July 1. Record partial-year-depreciation for the year ended December 31.
Acc205 Principles of Accounting: P9-27A Drive and Fly, near an airport, incurred
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$18
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$18