Fullerton Waste Management's Land and Warehouse Acquisition Details

What are the expenditures Fullerton Waste Management made in addition to the purchase price of the land and warehouse? What is the total cost basis of the land and warehouse? The expenditures made by Fullerton Waste Management in addition to the purchase price of the land and warehouse include: broker's commission of $24,000; fees for title search and title transfer of $2,800; and installation of fencing around the property costing $6,000. The total cost basis of the land and warehouse acquisition is $672,800.

Fullerton Waste Management's Land and Warehouse Acquisition

Fullerton Waste Management purchased land and a warehouse for $640,000. Besides the purchase price, the company incurred additional expenditures related to the acquisition. These expenditures included a broker's commission of $24,000, fees for title search and title transfer amounting to $2,800, and the installation of fencing around the property costing $6,000.

Cost Basis Calculation

The total cost of the land and warehouse acquisition is calculated by adding the purchase price to the additional expenditures. Therefore, the breakdown is as follows:

  • Purchase price of warehouse and land: $640,000
  • Broker's commission: $24,000
  • Fees for title search and title transfer: $2,800
  • Installation of fencing around the property: $6,000
Thus, the total cost basis of acquiring the land and warehouse is $672,800. This amount represents the total investment made by Fullerton Waste Management in acquiring the property, including all related expenses.

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