Use the following information to solve the following questions:
Morocco Corp. purchased land as a factory site for $ 250,000. They paid $ 10,000 to tear down two buildings on the land, and the salvage from these old buildings was sold for $ 1,350. Legal fees of $ 870 were paid for title investigation and making the purchase. Architect's fees were $ 10,300. Title insurance cost $ 600, and liability insurance during construction cost $ 650. Excavation costs were $ 2,610. A contractor was paid $ 600,000 to construct the new building. An assessment made by the city for pavement was $ 1,600. Interest costs during construction were $ 42,500.
-The cost of the building should be recorded at
A) $ 656,060.
B) $ 655,800.
C) $ 653,710.
D) $ 653,450.

Question

Quizplus · Accepted Answer

The cost of the building should include the purchase price of the land, the cost of demolishing the old buildings, the salvage value of the old buildings, the legal fees, the architect's fees, the title insurance, the liability insurance, the excavation costs, the construction costs, the assessment for pavement, and the interest costs during construction. The total cost of the building is $656,060.

Use the Following Information to Solve the Following Questions