contestada

Cala Manufacturing purchases land for $477,000 as part of its plans to build a new plant. The company pays $40,700 to tear down an old building on the lot and $60,165 to fill and level the lot. It also pays construction costs $1,535,600 for the new building and $96,932 for lighting and paving a parking area. Prepare a single journal entry to record these costs incurred by Cala, all of which are paid in cash.

Respuesta :

sahir9397

Answer:

(A) Record the Total Costs of the plant assets.

Transaction           General Journal           Debit        Credit      

1                                    Land                  477000                          

                              Dismantling cost           40700      

                                   Leveling cost           60165      

                              Construction cost           1535600      

                             Lighting & Paving Area   96932      

                                    Cash                                         2210397

Note:        

1. According to IAS 16 Cost of asset consists of expense which has endurs future economic benefit.  

2. Cost of Asset includes construction cost ,development cost , Dismantling cost and lighting & paving area etc.

Otras preguntas