Waterway Industries purchased land as a factory site for $1315000. Waterway paid
ID: 2600959 • Letter: W
Question
Waterway Industries purchased land as a factory site for $1315000. Waterway paid $117000 to tear down two buildings on the land. Salvage was sold for $8400. Legal fees of $5480were paid for title investigation and making the purchase. Architect's fees were $47000. Title insurance cost $3700, and liability insurance during construction cost $4000. Excavation cost $15800. The contractor was paid $4200000. An assessment made by the city for pavement was $9800. Interest costs during construction were $252000.
The cost of the building that should be recorded by Waterway Industries is
Explanation / Answer
Contractor Price = 4200000
Add:
Architect fees = 47000
Liability Insurance during construction = 4000
Excavation cost = 15800
Interest Cost = 252000
Total : 4518800
Cost of the building = 4518800
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