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Problem 1: On April 1, 2020, Theresa Corporation purchased a tract of land as a factory site for $195,500. An existing building on the property was razed and construction was begun on a new factory building on May 1, 2020. Additional data are available as follows: Cost of razing old building: $35,000, Title insurance and legal fees to purchase land: $12,500 Architect's fees: $47,500 New building construction cost: $985,000. How much should be the recorded cost of the completed factory building?
Option 1: $1,030,000Option 2: $1,032,500Option 3: $1,045,000Option 4: $1,067,500Option 5: none of the above
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