Los Mi-Os Purchased a Large Tract of Land with the Intention

Multiple Choice

Los Mi-os purchased a large tract of land with the intention to transform it into a cocoa plantation. Before the new seedlings can be planted, the site, which is prone to flooding, must be drained. The cost of the draining should be

A) expensed immediately.
B) capitalized as part of the cost of the land.
C) expensed only after the first crop of has been harvested.
D) reported as an operating loss.