Clothing purchased land, paying $ 110 comma 000 cash and signing a $ 250 comma 000 note payable. In addition, Alpine paid delinquent property tax of $ 1 comma 100 , title insurance costing $ 1 comma 550 , and $ 5 comma 900 to level the land and remove an unwanted building. Record the journal entry for purchase of the land.

Question

Abel Perry

Business

9 July, 06:03

Clothing purchased land, paying $ 110 comma 000 cash and signing a $ 250 comma 000 note payable. In addition, Alpine paid delinquent property tax of $ 1 comma 100 , title insurance costing $ 1 comma 550 , and $ 5 comma 900 to level the land and remove an unwanted building. Record the journal entry for purchase of the land.

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Answers (1)

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Ronald Booth · Answer 1

The journal entry is shown below:

Land A/c Dr

To Cash A/c

To Note payable A/c $250,000

(Being the purchase of the land is recorded)

The computation is shown below:

The cash would be

= Cash paid + delinquent property tax paid + title insurance cost + emove an unwanted building cost

= $110,000 + $1,100 + $1,550 + $5,900

= $118,550