Reference no: EM133079435

Question - In 2021, Crane Company had the following transactions related to the purchase of a property. All transactions were for cash unless otherwise stated.

Jan. 12 Purchased real estate for a future plant site for $401,000, paying $81,000 cash and signing a note payable for the balance. On the site, there was an old building. The fair values of the land and building were $391,000 and $31,000, respectively. The old building will be demolished and a new one built.

Jan. 16 Paid $7,100 for legal fees on the real estate purchase.

Jan. 31 Paid $22,500 to demolish the old building to make room for the new plant.

Feb. 13 Received $8,100 for residual materials from the demolished building.

Feb. 28 Graded and filled the land in preparation for the construction for $7,100.

Mar. 14 Paid $34,250 in architect fees for the building plans.

Mar. 31 Paid the local municipality $14,100 for building permits.

Apr. 22 Paid excavation costs for the new building of $16,100.

Sept. 26 The construction of the building was completed. The full cost was $721,000. Paid $126,000 cash and signed a mortgage payable for the balance.

Sept. 30 Purchased a one-year insurance policy for the building, $3,100.

Oct. 20 Paved the parking lots, driveways, and sidewalks for $34,000.

Nov. 15 Installed a fence for $10,100.

Required -

1. Record the above transactions.

2. Determine the cost of the land, land improvements, and building that will appear on Crane's December 31, 2021, balance sheet.