Reference no: EM133043553

Problem - McCoy's Fish House purchases a tract of land and an existing building for $930,000. The company plans to remove the old building and construct a new restaurant on the site. In addition to the purchase price, McCoy pays closing costs, including title insurance of $2,300. The company also pays $12,600 in property taxes, which includes $8,300 of back taxes [unpaid taxes from previous years] paid by McCoy on behalf of the seller and $4,300 due for the current fiscal year after the purchase date. Shortly after closing, the company pays a contractor $46,500 to tear down the old building and remove it from the site. McCoy is able to sell salvaged materials from the old building for $3,600 and pays an additional $10,300 to level the land. Determine the amount McCoy's Fish House should record as the cost of the land.