Question - On feb 12, Laker Company purchased a tract of land as factory site for $175,000. An existing building on the property was razed and construction was begun on a new factory building in March of the same year. Additional data are available as follows:
Cost of razing old building $35,000
Title insurance and legal fees to purchase land $ 12,500
Architects fees $42,500
New building cost $875,000
The recorded cost of the completed factory building should be
a) 910,000
b) 917,500
c) 930,000
d) 952, 500
Please show all work why the chosen answer is correct.