Chapter 16 Problem 16-4
Office Factory Land
Land building building improvements
Purchase price 1,300,000 700,000
Materials 3,200,000
Excavation 100,000
Labor 2,500,000
Remodeling 200,000
Cash discounts ( 60,000)
Supervision 30,000
Compensation insurance 50,000
Clerical and other expenses 30,000
Paving of streets 40,000
Plans and specifications 150,000
Legal cost - land 10,000 ________ ________ ______
1,310,000 900,000 6,000,000 40,000
1. The imputed interest on corporation’s own money is not capitalizable.
2. The payment of claim for injuries not covered by insurance and the legal cost of injury claim are treated as expense.
3. Saving on construction is not recognized.
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