Answer: $972,900
Explanation:
The cost of land consists of the actual purchase price, and all other expenses that are necessary to make the asset ready for its intended use. In terms of land, all these expenditures can include title fees, unpaid taxes from previous years only (i.e. not current taxes), and other expenses need to physically prepare the land for use. The current taxes figure of $4,600 is not included here, as it is only owed during the current year, therefore normal accounting rules for taxes will apply. This figure will thus be treated as a liability until it is paid. The back taxes were aqcuired when the asset was aqcuired, and thus form part of the cost.
Old buildings that were on the land, may need to be teared down so that land can be utilised. The costs used to demolish the building also forms part of the purchase price. On top of that, to fully prepare the land for use the land may need to be landscaped and leveled. All these costs contribute towards getting the land ready for use, and are thus included in the cost. Sales made on any item related to the land, during the process when the land was still being processed for its intended use, will reduce the cost of the asset, and deduct this figure. This figure will fall under sales, which is an income to the business. The full calculation of the cost is as follows:
Purchase price: $910,000
Title insurance: + $2,400
Unpaid property taxes: + $8,300
Cost of removing building: + $45,900
Sale of salvaged materials: - $4,000
Level the land: + $10,300
Cost of land: = $972,900
They should sell the info and make that cash cash money
Answer:
2018 loss for 1,500
2019 gain for 4,000
Explanation:
purchase at 715,000
December 31th 713,500
adjusting entry december 31th
loss on investment 1,500 debit
marketable securities 1,500 credit
january 3rd, 2019
cash 717,500 debit
gain on investemnt 4,000 credit
martetable securities 713,500 credit
to record gain on investment
already answered this question for you in a previous post.
Answer:
indicates what percent decline in sales could be sustained before the company would operate at a loss.
Explanation:
Since, Margin of safety ratio = Expected Sales - Break even sales
therefore,
The correct statement is : The margin of safety ratio indicates what percent decline in sales could be sustained before the company would operate at a loss.
