Rizio Company purchases a machine for $12,400, terms 1/10, n/60, FOB shipping point. Rizio paid within the discount period and took the $124 discount. Transportation costs of $280 were paid by Rizio. The machine required mounting and power connections costing $857. Another $404 is paid to assemble the machine, and $40 of materials are used to get it into operation. During installation, the machine was damaged and $215 worth of repairs were made. Complete the below table to calculate the cost recorded for this machine. Amount Included in Cost of Equipment: Invoice price of machine Net purchase price Total cost to be recorded

Rizio Company purchases a machine for $12,400, terms 1/10, n/60, FOB shipping point. Rizio paid within the discount period and took the $124 discount. Transportation costs of $280 were paid by Rizio. The machine required mounting and power connections costing $857. Another $404 is paid to assemble the machine, and $40 of materials are used to get it into operation. During installation, the machine was damaged and $215 worth of repairs were made. Complete the below table to calculate the cost recorded for this machine. Amount Included in Cost of Equipment: Invoice price of machine Net purchase price Total cost to be recorded

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 5EA: Steele Corp. purchases equipment for $25,000. Regarding the purchase, Steele recorded the following...

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Rix Company sells home appliances and provides installation and service for its customers. On April 1, 2019, a customer purchased a dishwasher that Rix normally sells for 1,000. In addition, the customer purchased the installation service and a 3-year service contract, with stand-alone selling prices of 200 and 400, respectively. Because the customer purchased all three items as a bundle, Rix charged the customer 1,400. Required: 1. How should the transaction price be allocated among the products? 2. Prepare the journal entries to recognize revenue related to each product in 2019.
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