Problem 23-16 (LAA) At the beginning of current year, Allison Company purchased new machine on a deferred payment basis. A down payment of P200,000 was made and four annual installments of P600,000 each are to be made every vear-end. The cash equivalent price of the machine was P2,300,000. Due to an employee strike, the entity could not install the machine immediately and thus incurred P30,000 of storage st. Cost of installation excluding the storage cost amounted to P80,000. What is the initial amount to be capitalized as the cost of the machine? 2,300,000 b. 2,380,000 a. C. 2,410,000 d. 2,600,000
Problem 23-16 (LAA) At the beginning of current year, Allison Company purchased new machine on a deferred payment basis. A down payment of P200,000 was made and four annual installments of P600,000 each are to be made every vear-end. The cash equivalent price of the machine was P2,300,000. Due to an employee strike, the entity could not install the machine immediately and thus incurred P30,000 of storage st. Cost of installation excluding the storage cost amounted to P80,000. What is the initial amount to be capitalized as the cost of the machine? 2,300,000 b. 2,380,000 a. C. 2,410,000 d. 2,600,000
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter12: Intangibles
Section: Chapter Questions
Problem 7MC
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Transcribed Image Text:a new machine on a deferred payment basis.
Problem 23-16 (LAA)
AS the beginning of current year, Allison Company purchased
A down payment of P200,000 was made and four annual
installments of P600,000 each are to be made every
year-end. The cash equivalent price of the machine was
P2,300,000.
Due to an employee strike, the entity could not install the
machine immediately and thus incurred P30,000 of storage
Pst Cost of installation excluding the storage cost amounted
to P80,000.
What is the initial amount to be capitalized as the cost of
the machine?
2,300,000
b. 2,380,000
2,410,000
d. 2,600,000
C.
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