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andrezito [222]
3 years ago
10

Soccer Wholesale purchased land and a warehouse for $990,000. In addition to the purchase price, Soccer Wholesale makes the foll

owing expenditures related to the acquisition: broker's commission, $49,600; title insurance, $2,300; and miscellaneous closing costs, $6,900. The warehouse is immediately demolished at a cost of $75,300 in anticipation of building a new warehouse.
Determine the amount Soccer Wholesale should record as the cost of the land.
Business
1 answer:
Elan Coil [88]3 years ago
6 0

Answer:

Cost of land= $1,124,100

Explanation:

<em>According to International accounting standards(IAS) 16 ,The cost of land includes purchase cost plus all other costs necessary to bring and make it ready for the intended use. </em>

<em>These costs include purchase cost, fees and commission associated with the purchase transaction. </em>

Further more, included in the historical cost are the net demolition cost of old structure to prepare the land for use. Net cost here means cost of demolition less any incidental proceed from the old structure.

However, remember that land is not depreciated because it has an infinite life span.

So using the historical cost principle the cost of the land

Cost of land = 990,000 + 49,600 +2300 + 6, 900 + 75,300=  1,124,100.00

Cost of land= $1,124,100

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When buying highly technical, few-of-a-kind products such as hydroelectric power plants, governments have found that general con
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Cost-plus-fixed-fee pricing

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3 years ago
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6 0
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The current sections of Whispering Winds Corp.’s balance sheets at December 31, 2019 and 2020, are presented here. Whispering Wi
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The amount of cash provided by  operating activities is $155,000

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The net cash provided by operating activities is shown below by the cash flow statement extract:

Net income                                                                 $152,000

depreciation  expense                                             $24,900

increase in accounts receivable($109700-$77900)($31,800)

Decrease in inventory($171,900-$157,000)              $14,900

increase in prepaid expenses($26,700-$25,100)   ($1,600)

increase in accrued expenses($14,600-$8400)      $6,200

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net cash provided by operating activities                $155,000

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An increase in liability means depriving the other party some cash,hence it is positive and vice versa.

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