Martin Buber Co purchased land as a factory site for

Martin Buber Co purchased land as a factory site for

Martin Buber Co. purchased land as a factory site for $673,200. The process of tearing down
two old buildings on the site and constructing the factory required 6 months.

The company paid $70,686 to raze the old buildings and sold salvaged lumber and brick for
$10,603. Legal fees of $3,114 were paid for title investigation and drawing the purchase
contract. Martin Buber paid $3,703 to an engineering firm for a land survey, and $114,444 for
drawing the factory plans. The land survey had to be made before definitive plans could be
drawn. Title insurance on the property cost $2,525, and a liability insurance premium paid
during construction was $1,515. The contractor's charge for construction was $4,611,420. The
company paid the contractor in two installments: $2,019,600 at the end of 3 months and
$2,591,820 upon completion. Interest costs of $286,110 were incurred to finance the
construction.

Instructions

Determine the cost of the land and the cost of the building as they should be recorded on the
books of Martin Buber Co. Assume that the land survey was for the building.

Martin Buber Co purchased land as a factory site for

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factory-site-for/

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