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What value should be assigned to the tract of land

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Omar Corporation paid $200,000 for a tract of land that had an old gas station on it. The gas station was demolished at a cost of $20,000 and a new warehouse was constructed on the site at a cost of $550,000.

In addition, several other costs were incurred:

Legal fees (associated with the purchase of the land) $35,000

Architect fees (associated with the new warehouse) $42,000

Interest on the construction loan (for the new warehouse) $18,000

Problem (a) What value should be assigned to the tract of land?

Problem (b) What value should be assigned to the new warehouse?

Reference no: EM132843641

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