acquisition Cost of Long-Lived Asset The following data relate to a firm’s purchase of a machine used in the manufacture of its product: Invoice price $34,000 Applicable sales tax 2,000 Cash discount taken for prompt payment 400 Freight paid 260 Cost of insurance coverage on machine while in transit 125 Installation costs 2,000 Testing and adjusting costs 475 Repair of damages to machine caused by the firm’s employees 750 Prepaid maintenance contract for first year of machine’s use 400 Determine the acquisition cost of the machine.Acquisition Cost = $Answer
acquisition Cost of Long-Lived Asset The following data relate to a firm’s purchase of a machine used in the manufacture of its product: Invoice price $34,000 Applicable sales tax 2,000 Cash discount taken for prompt payment 400 Freight paid 260 Cost of insurance coverage on machine while in transit 125 Installation costs 2,000 Testing and adjusting costs 475 Repair of damages to machine caused by the firm’s employees 750 Prepaid maintenance contract for first year of machine’s use 400 Determine the acquisition cost of the machine.Acquisition Cost = $Answer
Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter8: Operating Assets: Property, Plant, And Equipment, And Intangibles
Section: Chapter Questions
Problem 8.1E
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acquisition Cost of Long-Lived Asset
The following data relate to a firm’s purchase of a machine used in the manufacture of its product:
Invoice price | $34,000 |
Applicable sales tax | 2,000 |
Cash discount taken for prompt payment | 400 |
Freight paid | 260 |
Cost of insurance coverage on machine while in transit | 125 |
Installation costs | 2,000 |
Testing and adjusting costs | 475 |
Repair of damages to machine caused by the firm’s employees | 750 |
Prepaid maintenance contract for first year of machine’s use | 400 |
Determine the acquisition cost of the machine.
Acquisition Cost = $Answer
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