Problem 10-1 At December 31, 2016, certain accounts included in the property, pl

Question

Problem 10-1

At December 31, 2016, certain accounts included in the property, plant, and equipment section of Monty Company’s balance sheet had the following balances.

During 2017, the following transactions occurred.

The building was completed and occupied on September 30, 2017.

(a) Calculate the balance at December 31, 2017 in each of the following balance sheet accounts. Disregard the related accumulated depreciation accounts.

Land $239,000 Buildings 901,400 Leasehold improvements 660,000 Equipment 882,000

Explanation / Answer

Solution:

a) Calculating the Balance at December 31, 2017 in Each of the Following Balance Sheet Accounts:

Analysis of Land:

Analysis of Building:

Analysis of Leasehold Improvements:

Analysis of Equipment:

Particulars Amount Amount Balance at January 1, 2017 $239,000 Land Site 621: Acquisition Cost $859,100 Commission paid to real Estate $51,100 Clearing of Land $44,400 Less: Amount Recoverd ($14,600) Total Cost of Land Site 621 $940,000 Land Site 622 Land Value $297,200 Building Value $119,200 Demolition Value $40,700 Total Value of Land site 622 $457,100 Balance at December 31, 2017 $1,636,100

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