Allocating Payments and Receipts to Fixed Asset Accounts The following payments

Question

Allocating Payments and Receipts to Fixed Asset Accounts The following payments and receipts are related to land, land improvements, and buildings acquired for use in a wholesale ceramic business. The receipts are identified by an asterisk a. Fee paid to attorney for title search b. Cost of real estate acquired as a plant site: Land 3,200 340,000 2,300 19,100 5,400 3,200* 12,700 46,700 4,500 18,700 Building (to be demolished) c. Delinquent real estate taxes on property, assumed by purchaser d. Cost of razing and removing building acquired in B e. Proceeds from sale of salvage materials from old building f. Special assessment paid to city for extension of water main to the property g. Architect's and engineer's fees for plans and supervision h. Premium on one-year insurance policy during construction I. Cost of filling and grading land Money borrowed to pay building contractor 797,200 k. Cost of repairing windstorm damage during construction L Cost of paving parking lot to be used by customers m. Cost of trees and shrubbery planted n. Cost of floodlights installed on parking lot o. Cost of repairing vandalism damage during construction p. Proceeds from insurance company for windstorm and vandalism damage 5,900 16,100 9,600 1,100 2,600 6,400*

Explanation / Answer

1&2.

The payment and receipts should be assigned in the following manner:

For b, both the amounts, 340,000 and 32,300 should be added.

All figures shown with a star in the question are receipts and should be entered with a minus sign as these will be subtracted while determining total amount to be debited to the assets.

Land Land Improvements Building Other Accounts a. 3200 b. 372300 c. 19100 d. 5400 e. -3200 f. 12700 g. 46700 h. 4500 i. 18700 j. -797200 k. 5900 l. 16100 m. 9600 n. 1100 o. 2600 p. -6400 q. 849900 r. 39900 s. -375 Amount to be debited 428200 26800 940625

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.