Reference no: EM132769854

Question - At December 31, 2018, certain accounts included in the property, plant and equipment section of the Lying Co's statement of financial position had the following balances:

Land P10,000,000

Buildings 8,000,000

During 2019 the following transactions occurred:

1. Land site no. 621 was acquired for P1,000,000. Additionally, to acquire the land, Lying paid a P60,000 commission to a real estate agent. Cost of P15,000 were incurred to clear the land During the course of clearing the land , timber and gravel were recovered and sold for P5,000.

2. A second tract of land site no. 622) with a building was acquired for P300,000. The closing statement indicated that the land was P200,000 and the building value was P100,000. Shortly after acquisition, the building was demolished at a cost of P30,000. building was constructed for P150,000 plus the following costs:

Excavation fees P 11,000

Architectural design fees 8,000

Building permit fee 1,000

The building was completed and occupied on September 25, 2019.

Required - Make a detailed analysis of the changes in the Land account and Building account and show their balances as of December 31, 2019.