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 Applicable sales tax Cash discount taken for prompt payment Freight paid Cost of insurance coverage on machine while in transit Installation costs Testing and adjusting costs Repair of damages to machine caused by the firm's employees Prepaid maintenance contract for first year of machines use Determine the acquisition cost of the machine. Acquisition Cost $306,560 $299.000 2,100 1.300 1.160 11025 1.900 1.375 11450 1/200

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 Applicable sales tax Cash discount taken for prompt payment Freight paid Cost of insurance coverage on machine while in transit Installation costs Testing and adjusting costs Repair of damages to machine caused by the firm's employees Prepaid maintenance contract for first year of machines use Determine the acquisition cost of the machine. Acquisition Cost $306,560 $299.000 2,100 1.300 1.160 11025 1.900 1.375 11450 1/200

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter7: Operating Assets

Section: Chapter Questions

Problem 42E

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The following data relate to a firm's purchase of a machine used in the manufacture of its product: Invoice price Applicable sales tax Cash discount taken for prompt payment Freight paid Cost of insurance coverage on machine while in transit Installation costs Testing and adjusting costs Repair of damages to machine caused by the firm's employees Prepaid maintenance contract for first year of machine's use $30,000 2,000 400 260 125 3,000 475 750 300 Determine the acquisition cost of the machine. Acquisition Cost $ 0
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Which costs does a company expense AFTER a long-term asset is put into use in the business? O Routine costs O Extraordinary costs O All after acquisition costs O None of the above SUBMIT
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.
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