The cost of land does NOT include
A) costs to clear the land.
B) annual property taxes.
C) accrued property taxes assumed by the purchaser.
D) legal fees.

Question

Quizplus · Accepted Answer

Annual property taxes are considered an operating expense, not a capital expenditure. The cost of land includes initial acquisition costs and expenses to prepare the land for its intended use, but not the recurring taxes paid on an annual basis.

The Cost of Land Does NOT Include