stion 5 (6 marks) 1 Walnut Grove is a quaint town that attracts tourists all...
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stion 5 (6 marks) 1 Walnut Grove is a quaint town that attracts tourists all year long. The municipality established a visitors' center by purchasing land for $150,000 cash and signing a $100,000 note payable. The municipality also had to pay back property taxes of $3,000 and $20,000 to remove an unwanted building. $80,000 was paid to prepare the land for foundation and a new building was constructed for $2,000,000. The visitor centre also paid for $90,000 for paving a parking lot, $25,000 for landscaping and $40,000 for signage. Required a. Classify and determine the cost of the plant assets acquired for the visitors' centre. b. Discuss the historical cost principle and why values will differ when compared to the fair value of plant assets
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