Identify the costs that will be capitalized as Land, Land

Improvement, Building, Machinery, and will be expensed as

incurred.
Edmodo Company Incurred the following costs during the
current year in relation to property plant and equipment:
Cost incurred Land
Cash paid for purchase of land 12,500,000 12,500,000
Mortgage assumed on the land purchased, including interest
accrued 3,000,000 3,000,000
Realtor commission 300,000 300,000
Legal fees, realty taxes and documentation expenses 50,000 50,000

Amount paid to relocate persons squatting on the property 100,000 100,000

Cost of tearing down an old building on the land to make room
for construction of new building 300,000
Salvage value of the old building demolished 150,000
Cost of fencing the property 500,000

Amount paid to the contractor for the building constructed 7,500,000

Building permit fee 100,000
Excavation 100,000
Architect fee 350,000
Interest that would have been earned had the money used
during the period of construction been invested 1,500,000
Invoice cost of machine acquired 3,000,000
Freight, unloading and delivery charges 45,000
Custome duties and other charges 125,000
Allowance and hotel accomodaation, paid to foreign technicians
during installation and test run of machine 346,000
Total 29,966,000 15,950,000
Land Improvement Building Machinery Expensed as incurred

300,000
-150,000
500,000

7,500,000
100,000
100,000
350,000

3,000,000
45,000
125,000

346,000
500,000 8,200,000 3,516,000 0