When a Company Purchases Land with a Building on It

question 166

Multiple Choice

When a company purchases land with a building on it and immediately tears down the building so that the land can be used for the construction of a plant, the costs incurred to tear down the building should be:

• A) added to the cost of the plant.
• B) amortized over the estimated time period between the tearing down of the building and the completion of the plant.
• C) expensed as incurred.
• D) added to the cost of the land.

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