Question

S10-1 (similar to) Alpine Clothing purchased​ land, paying $ 110 comma 000 cash and signing a $ 270 comma 000 note payable. In​ addition, Alpine paid delinquent property tax of $ 2 comma 000​, title insurance costing $ 1 comma 550​, and $ 4 comma 200 to level the land and remove an unwanted building. Record the journal entry for purchase of the land. Begin by determining the cost of the land.

Answer 1

Answer:

land      387,750 debit

  cash                       110,000 credit

  accounts payable 270,000 credit

--to record the acquisition of land---

Explanation:

all incurred cost related to ge the land ready to use must be part of land:

price: 110,000 cash

         270,000 note payable

             2,000 property tax debt

             1,550 title insurance

            4,200 soil work

         387,750 land value.

As this is an asset it enter  the accounting in the debit column. the method of payment goes into credit.