Q10.3On February 1, 2020, Sheridan Company purchased a parcel of land as a factory site for $315000. An old building on the property was demolished, and construction began on a new building which was completed on November 1, 2020. Costs incurred during this period are listed below:Demolition of old building $18600Architect's fees 35500Legal fees for title investigation and purchase contract 5700Construction costs 1387000(Salvaged materials resulting from demolition were sold for $9700.)Sheridan should record the cost of the land and new building, respectively, as$323900 and $1428200.$323900 and $1422500.$329600 and $1422500.$339300 and $1412800.

Cost of Land: The cost of land comprises the purchase price (cash plus any notes due), brokerage…

Answered: On February 1, 2020, Sheridan Company…

SWFT Essntl Tax Individ/Bus Entities 2020

23rd Edition

ISBN:9780357391266

Author:Nellen

Publisher:Nellen

Chapter17: Business Tax Credits And The Alternative Minimum Tax

Section: Chapter Questions

Problem 11P

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Q10.3

On February 1, 2020, Sheridan Company purchased a parcel of land as a factory site for $315000. An old building on the property was demolished, and construction began on a new building which was completed on November 1, 2020. Costs incurred during this period are listed below:

Demolition of old building	$	18600
Architect's fees	35500
Legal fees for title investigation and purchase contract	5700
Construction costs	1387000
(Salvaged materials resulting from demolition were sold for $9700.)