Mary Holtz

 Essay in Joan Holtz

ase 7-2

Joan Holtz (C)*

Joan Holtz said to the accounting trainer. " The

general principle for coming to the amount of a fixed

asset that may be to be made a fortune is reasonably crystal clear, but

right now there certainly are a great many problems in applying

this principle to specific circumstances. "

Following are some of the problems Joan Holtz


1 ) Suppose that the Bruce Making Company

applied its own maintenance crew to develop an

added wing upon its existing factory building.

What is the proper accounting treatment of

the following items?

a. Architects' charges.

b. The expense of snow removal dining building.

c. Funds discounts gained for quick payment in

materials purchased for construction.

d. The cost of building a put together construction

workplace and toolshed that would be tom down

when the factory side had been accomplished.

e. Curiosity on money borrowed to finance


f. Local real estate taxation for the period of constru-

ction around the portion of area to be filled by

the modern wing.

g. The cost of mistakes made during constmctiun.

they would. The expenses of the maintenance depar-

tment that include supervision; depreciation upon

~ Copyright laws O by President and Fellows of Harvard

School. Harvard Organization School circumstance 198-145.

properties and gear of maintenance depa-

rtment shops; warmth, light, and power for these

shops; and allocations of cost to get such things as

the cafeteria, medical office, and personnel


i. The price tag on insurance during construction and

the cost of damage or losses on virtually any injuries or

losses not covered by insurance.

Assume that the Archer Cotlapany bought a large

piece of land, including the buildings thereon, with

the intent of razing the buildings and constructing

a combined motel and workplace in their place.

The existing complexes consisted of a theater and


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