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 $22,000 Applicable sales tax 1,400 Cash discount taken for prompt payment 600 Freight paid 460 Cost of insurance coverage on machine while in transit 325 Installation costs 1,200 Testing and adjusting costs 675 Repair of damages to machine caused by the firm's employees 750 Prepaid maintenance contract for first year of machine's use 500 Determine the acquisition cost of the machine. Acquisition Cost = $Answer PreviousSave AnswersNext
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 $22,000 Applicable sales tax 1,400 Cash discount taken for prompt payment 600 Freight paid 460 Cost of insurance coverage on machine while in transit 325 Installation costs 1,200 Testing and adjusting costs 675 Repair of damages to machine caused by the firm's employees 750 Prepaid maintenance contract for first year of machine's use 500 Determine the acquisition cost of the machine. Acquisition Cost = $Answer PreviousSave AnswersNext
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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 | $22,000 |
| Applicable sales tax | 1,400 |
| Cash discount taken for prompt payment | 600 |
| Freight paid | 460 |
| Cost of insurance coverage on machine while in transit | 325 |
| Installation costs | 1,200 |
| Testing and adjusting costs | 675 |
| Repair of damages to machine caused by the firm's employees | 750 |
| Prepaid maintenance contract for first year of machine's use | 500 |
Determine the acquisition cost of the machine.
Acquisition Cost = $Answer
PreviousSave AnswersNext
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