Lumber Broker

Duver Company acquires land for $100,000 cash. Additional costs are as follows:?

Removal of shed$ 500
Filling and grading1,000
Salvage value of lumber of shed100
Broker commission2,000
Paving of parking lot15,000
Closing costs560
What will Duver record the acquisition cost of the land as?

Removal of shed $ 500
Filling and grading 1,000
Salvage value of lumber of shed (100) – reduces the acquisition cost
Broker commission 2,000
Closing costs 560

The total acquisition cost of the land would be 103,960

The parking lot paving cost would be a property improvement and not part of the land acquisition cost

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