Gagner Clinic purchases land for $110,000 cash.The clinic assumes $1,500 in property taxes due on the land.The title and attorney fees totaled $1,000.The clinic has the land graded for $2,200.What amount does Gagner Clinic record as the cost for the land?

Question

Quizplus · Accepted Answer

The cost of land includes all expenditures to acquire the land and prepare it for use. This includes the purchase price ($110,000), property taxes assumed ($1,500), title and attorney fees ($1,000), and grading costs ($2,200). Total cost = $110,000 + $1,500 + $1,000 + $2,200 = $114,700.

Gagner Clinic Purchases Land for $110,000 Cash