Use the following information for questions
Seiler Co.purchased land as a factory site for $600,000.Seiler paid $60,000 to tear down two buildings on the land.Salvage was sold for $5,400.Legal fees of $3,480 were paid for title investigation and making the purchase.Architect's fees were $31,200.Title insurance cost $2,400, and liability insurance during construction cost $2,600.Excavation cost $10,440.The contractor was paid $2,200,000.An assessment made by the city for pavement was $6,400.Interest costs during construction were $170,000.
-The cost of the building that should be recorded by Seiler Co.is
A)$2,403,800.
B)$2,404,840.
C)$2,413,200.
D)$2,414,240.

Question

Use the following information for questions 
Seiler Co.purchased land as a factory site for $600,000.Seiler paid $60,000 to tear down two buildings on the land.Salvage was sold for $5,400.Legal fees of $3,480 were paid for title investigation and making the purchase.Architect's fees were $31,200.Title insurance cost $2,400, and liability insurance during construction cost $2,600.Excavation cost $10,440.The contractor was paid $2,200,000.An assessment made by the city for pavement was $6,400.Interest costs during construction were $170,000.
-The cost of the building that should be recorded by Seiler Co.is
A)$2,403,800.
B)$2,404,840.
C)$2,413,200.
D)$2,414,240.

Quizplus · Accepted Answer

The cost of the building includes all costs directly associated with its construction: contractor's fee ($2,200,000), architect's fees ($31,200), liability insurance during construction ($2,600), excavation cost ($10,440), and interest costs during construction ($170,000). Adding these gives $2,414,240.

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