The capitalized cost of land excludes:

a. The purchase price of the land.

b. Title insurance paid at the time of purchase.

c. Real estate commissions associated with the sale.

d. Property taxes for the first year owned.

Question

Nikolai Montgomery

Business

17 November, 15:56

The capitalized cost of land excludes:

a. The purchase price of the land.

b. Title insurance paid at the time of purchase.

c. Real estate commissions associated with the sale.

d. Property taxes for the first year owned.

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Answers (1)

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Darryl Bennett · Answer 1

(D) Property taxes for the first year owned.

Explanation:

Capitalized cost is an added expense of a fixed asset. This is not the price paid for an asset but an additional expense incurred overtime in the form of depreciation or amortization. Excluded in this cost is the property taxes for the first year owned. It is included in the cost basis of the asset.

The capitalized cost of land excludes:a. The purchase price of the land.b. Title insurance paid at the time of purchase.c. Real estate commissions associated with the sale.d. Property taxes for the first year owned.

The capitalized cost of land excludes:

a. The purchase price of the land.

b. Title insurance paid at the time of purchase.

c. Real estate commissions associated with the sale.

d. Property taxes for the first year owned.