The expenditures and receipts below are related to land, land improvements, and

Question

The expenditures and receipts below are related to land, land improvements, and buildings acquired for use in a business enterprise. The receipts are enclosed in parentheses.

Identify each item by letter and list the items in columnar form, using the headings shown below. All receipt amounts should be reported in parentheses. For any amounts entered in the Other Accounts column, also indicate the account title. (Enter receipt amounts using either a negative sign preceding the number e.g. -45 or parentheses e.g. (45). If no entry is required in other accounts, select "No Entry" for the account titles.)

(a) Money borrowed to pay building contractor (signed a note) $(292,600 ) (b) Payment for construction from note proceeds 292,600 (c) Cost of land fill and clearing 11,790 (d) Delinquent real estate taxes on property assumed by purchaser 7,630 (e) Premium on 6-month insurance policy during construction 11,040 (f) Refund of 1-month insurance premium because construction completed early (1,840 ) (g) Architect’s fee on building 25,450 (h) Cost of real estate purchased as a plant site (land $200,400 and building $52,600) 253,000 (i) Commission fee paid to real estate agency 8,320 (j) Installation of fences around property 3,930 (k) Cost of razing and removing building 11,710 (l) Proceeds from salvage of demolished building (5,080 ) (m) Interest paid during construction on money borrowed for construction 13,690 (n) Cost of parking lots and driveways 17,940 (o) Cost of trees and shrubbery planted (permanent in nature) 12,930 (p) Excavation costs for new building 3,110

Explanation / Answer

Land Land Improvements Buildings Other Accounts (a) Money borrowed to pay building contractor (signed a note) -292600 -292600 (b) Payment for construction from note proceeds 2,92,600 292600 (c) Cost of land fill and clearing 11,790 11790 (d) Delinquent real estate taxes on property assumed by purchaser 7,630 7630 (e) Premium on 6-month insurance policy during construction 11,040 11040 (f) Refund of 1-month insurance premium because construction completed early -1840 -1840 (g) Architect’s fee on building 25,450 25450 (h) Cost of real estate purchased as a plant site (land $200,400 and building $52,600) 2,53,000 200400 52600 (i) Commission fee paid to real estate agency 8,320 6590 1730 (j) Installation of fences around property 3,930 3930 (k) Cost of razing and removing building 11,710 11710 (l) Proceeds from salvage of demolished building -5080 -5080 (m) Interest paid during construction on money borrowed for construction 13,690 13690 (n) Cost of parking lots and driveways 17,940 17940 (o) Cost of trees and shrubbery planted (permanent in nature) 12,930 12930 (p) Excavation costs for new building 3,110 3110 Total 373620 218550 42660 405010 -292600

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