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Tutorial 18367

Allegro Supply Company, a newly formed corporation, incurred the following expenditures related to Land, to Buildings, and to Machinery and Equipment....

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Question:

 Allegro Supply Company, a newly formed corporation, incurred the following expenditures related to Land, to Buildings, and to Machinery and Equipment.

                Abstract company\'s fee for title search                                                 $ 520

                Architect\'s fees                                                                                                3,170

                Cash paid for land and dilapidated building thereon                        92,000

                Removal of old building $20,000

                    Less: Salvage                  5,500                                                                     14,500

                Interest on short-term loans during construction                             7,400

                Excavation before construction for basement                                   19,000

                Machinery purchased (subject to 2% cash discount,                        

                    which was not taken)                                                                                65,000

                Freight on machinery purchased                                                              1,340

                Storage charges on machinery, necessitated by                 

                    noncompletion of building when machinery was                          2,180

                    delivered                         

                New building constructed (building construction took 6                 

                    months from date of purchase of land and old building)            485,000

                Assessment by city for drainage project                                                               1,600

                Hauling charges for delivery of machinery from storage to                            

                    new building                                                                                                 620

                Installation of machinery                                                                             2,000

                Trees, shrubs, and other landscaping after completion of                             

                    building (permanent in nature)                                                            5,400