The Howell’s decided to build a resort hotel on land owned by Chief Ugundi. For each of the following items, indicate whether the cost should be recorded as Land (L), Land Improvements (LI), Resort Hotel (RH), or Equipment (E) by placing the correct answer in the space provided.
Answer
⦁ Fences around the property site cost $50,000
⦁ Construction of the resort hotel cost $5,000,000
⦁ Demolition of existing huts on the land cost $80,000
⦁ Installation of wooden sidewalks between the resort hotel and parking lot cost $40,000
⦁ Architectural fees for the resort hotel cost $30,000
⦁ A construction permit obtained from Chief Ugundi cost $20,000
⦁ Clearing the brush and removing unwanted trees on the site cost $60,000
⦁ Purchased a wagon to assist with hauling away trees and dirt for $25,000
⦁ The Professor charged $40,000 to act as engineer and architect on the resort hotel
⦁ Constructing permanent tiki torches around the site as lighting cost $10,000
⦁ Landscaping (shrubs and decorative ornaments) around the resort cost $100,000
⦁ The actual purchase price for the land cost $200,000
LI - Fences around the property site cost $50,000
RH - Construction of the resort hotel cost $5,000,000
LI - Demolition of existing huts on the land cost $80,000
LI - Installation of wooden sidewalks between the resort hotel and parking lot cost $40,000
RH - Architectural fees for the resort hotel cost $30,000
RH - A construction permit obtained from Chief Ugundi cost $20,000
L - Clearing the brush and removing unwanted trees on the site cost $60,000
E - Purchased a wagon to assist with hauling away trees and dirt for $25,000
RH - The Professor charged $40,000 to act as engineer and architect on the resort hotel
LI - Constructing permanent tiki torches around the site as lighting cost $10,000
LI - Landscaping (shrubs and decorative ornaments) around the resort cost $100,000
L-The actual purchase price for the land cost $200,000
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