The following expenditures were incurred by Obermeyer Company in purchasing land: cash price $70,499, accrued taxes $2,104, attorneys' fees $3,007, real estate broker's commission $1,501, and clearing and grading $2,501. What is the cost of the land?
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You are offline so I switched to the Q&A mode. All the costs that you have listed are capitalized and added to the total cost of the land. The two links below support this. The first one is the policy for capitalization for Indiana University that is in an easy to read format and the other is the definitive explanation. http://www.iu.edu/~vpcfo/policies/accounting/i-200.htmlhttp://www.nysscpa.org/cpajournal/2004/304/essencials/p34.htmLet me know if you have any other questions. Dave