Question: Bylund Corporation was organized in June 2013.
Bylund Corporation was organized in June 2013. In auditing its books, you find the following land, buildings, and equipment account:
An analysis of this account and of other accounts disclosed the following additional information:
(a) The building acquired on June 16, 2013, was valued at $41,000.
(b) The corporation paid $15,000 for the demolition of the old building and then sold the scrap for $7,000 and credited the proceeds to Miscellaneous Revenue.
(c) The corporation executives did not participate in the construction of the new building.
(d) The county real estate tax was for the 6-month period ended December 31, 2013, and was assessed by the county on the land.
Instructions:
Prepare journal entries to correct Bylund Corporation’s books.
Transcribed Image Text:
Account: LAND, BUILDINGS, AND EQUIPMENT Balance Date Item Debit Credit Debit Credit 2013 June 8 Organization fees paid to the state 21,000 21,000 16 Land site and old building 325,000 346,000 30 Corporate organization costs 40,000 386,000 July 2 Title clearance fees 15,300 401,300 Aug. 28 Cost of razing old building 15,000 416,300 Sept. 1 Salaries of Bylund Corporation executives 516,300 100,000 Cost to acquire patent for special equipment 54,000 570,300 Dec. 12 Stock bonus to corporate promoters, 3,000 shares 150,000 720,300 of common stock, $50/share market value 15 County real estate tax 13,200 733,500 15 Cost of new building completed and occupied on this date 1,450,000 2,183,500
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