Question

Cowboy Development incurred the following costs associated with the purchase of a piece of land that it will use to re-build an office building: Sale price of the land $400,000 Sale of salvaged parts already on land $20,000 Demolition of the old building $30,000 Ground breaking ceremony (food and supplies) $1,500 Land preparation and leveling $7,500What amount should be recorded for the purchase of the land?

Answer 1

The amount should be recorded for the purchase of the land is $417500.

Step-by-step explanation:

amount of land = sale price of the land - sale of salvaged parts + bemolition of the old buiding + land preparation and leveling

= $400000 - $20000 + $30000 + $7500

= $417500

Therefore, The amount should be recorded for the purchase of the land is $417500.