mawn company bought land and built a warehouse during 2016 it improperly debited the 3384311

Mawn Company bought land and built a warehouse during 2016. It improperly debited the following related costs to an account titled Land and Buildings: Land purchase…………………….. $ 22,000 Demolition of old building…………………… 3,000 Legal fees for land acquisition………………… 1,500 Avoidable interest on loan for construction……………. 2,900 Building construction…………………… 53,000 Assessment by city for sewer connection— city is responsible for maintenance… 1,200 Landscaping (expected to be permanent in nature)…………. 3,500 Equipment purchased for excavation……………… 18,800 Pro rata portion of fixed overhead incurred during construction of building.. 15,000 Insurance on building during construction…………….. 1,000 Profit on construction………………….. 12,000 Compensation for injury to construction worker (not covered by the insurance policy purchased by Mawn)…………………… 3,000 Modifications to building ordered by building inspectors (due to poor planning by Mawn) ………………………….7,500 Deliquent property taxes on land paid in 2016 (land was purchased during the year) ……………………………2,500 Required: Prepare the correcting entries on December 31, 2016, to properly reclassify the preceding items.

 

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