Hadley Company purchased an asset with a list price of $135580. Hadley paid $413 of transportation-in cost, $968 to train an employee to operate the equipment, and $637 to insure the asset against theft after it has been set up in the factory. The asset was purchased under terms 2/20/n30 and Hadley paid for the asset within the discount period. Based on this information, Hadley would capitalize the asset on its books at what dollar amount? $_______________
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Hadley Company purchased an asset with a list price of $135580. Hadley paid $413 of transportation-in cost, $968 to train an employee to operate the equipment, and $637 to insure the asset against theft after it has been set up in the factory. The asset was purchased under terms 2/20/n30 and Hadley paid for the asset within the discount period. Based on this information, Hadley would capitalize the asset on its books at what dollar amount? $_______________
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- Corazon Company purchased an asset with a list price of $17,600. Corazon paid $1,400 of transportation-in cost, $1,700 to train an employee to operate the equipment, and $1,100 to insure the asset against theft after it has been set up in the factory. The asset was purchased under terms 1/20, n/30 and Corazon paid for the asset within the discount period. Based on this information, Corazon would capitalize the asset on its books at: Multiple Choice O O O $19,124. $17,600. $19,300. $20,524.Majestic LLC purchased a factory for lump-sum of RO800,000 paid via bank. The fair value of each of the component of the purchase is given below: Land 85000 Building 155000 Equipment 460000 Calculate the amount at which each of the above components shall be recognized on purchase date and write the journal entry for recording purchase transaction.Willis Company trades in a printing press for a newer model. The cost of the old printing press was $62,000, and accumulated depreciation up to the date of the trade - in is $46,000. The company also pays $45,000 cash for the newer printing press. The fair market value of the newer printing press is $70,000. The journal entry to acquire the new printing press will required a debit to Printing Press for: A. $45,000 B. $108,000. C. $70,000. D. $62,000
- Connors Corporation acquired manufacturing equipment for use in its assembly line. Below are four independent situations relating to the acquisition of the equipment. The equipment was purchased on account for $43,000 Credit terms were 310/, n30/. Payment was made within the discount period and the company records the purchases of equipment net of discounts. Connors gave the seller a noninterest-bearing note. The note required payment of $45,000 one year from date of purchase. The fair value of the equipment is not determinable. An interest rate of 12% properly reflects the time value of money in this situation, Connors traded in old equipment that had a book value of $15,000 ( original cost of $32, 000 and accumulated depreciation of $17,000) and paid cash of 540,000. The old equipment had a fair value of $9, 700 on the date of the exchange. The exchange has commercial substance. Connors issued 2, 000 shares of its no-par common stock in exchange for the equipment. The market value of…ccCullumber Company owns delivery equipment that cost $53,800 and has accumulated depreciation of $27,300 as of July 30, 2020. On that date, Cullumber disposes of this equipment. For parts b - d below, enter D for debit or C for credit in the first box and the amount in the second box. What is the net book value of the equipment on July 30, 2020? Assume Cullumber scraps the equipment as having no value on July 30. What is the gain or loss, if any, that Cullumber should recognize? Assume Cullumber sells the equipment for $37,200 cash on July 30. What is the gain or loss, if any, that Cullumber should recognize? Assume Cullumber sells the equipment for $18,000 cash on July 30. What is the gain or loss, if any, that Cullumber should recognize?Coulter Company purchases a piece of equipment on February 1, 2020 for $80.000. In addition to the purchase price, the company makes the following expenditures: freight. $3.400 installation. $1.650; testing prior to use, $800: property taxes on the equipment for the first year $1.200: sale tax on the purchase $2.000, and prepayment of the first year of insurance on the equipment. $1,400. What amount should Coulter Company debit the equipment account for on the date of purchase? $90,450 $87.050 $87.850 $89,050 None of the above.
- On January 2, 2022, Lauren Corporation purchased factory equipment for $850,000. In addition, it paid $82,000 in sales tax and $7,000 in installation charges. Shipping costs to ship the equipment to the factory were $2,500 and were paid by Lauren. Lauren paid $300,000 in cash and signed a two-year note for the balance. Required: Prepare the journal entry to record the acquisition of this equipment. Assuming straight-line depreciation, an estimated residual value of $75,000 and an estimated life of 10 years, prepare the journal entry for the depreciation expense for 2021.Canada Company purchased a machine at an invoice price of P4,500,000 with terms 2/10, n/30. The entity paid the required amount for the machine beyond the discount period. The entity paid P80,000 for delivery of the machine and P310,000 for installation and testing. The machine was ready for use on January 1, 2019. It was estimated that the machine would have a useful life of 5 years and a residual value of P800,000. Engineering estimated indicated that the useful life of productive units was 200,000. Units actually produced during the first two years were 30,000 in 2019 and 48,000 in 2020. The entity decided to use the output method of depreciation. What is the accumulated depreciation of the machine on December 31, 2020? A. 1,560,000 B. 1,600,000 C. 960,000 D. 600,000Connors Corporation acquired manufacturing equipment for use in its assembly line. Below are four independent situations relating to the acquisition of the equipment. 1. The equipment was purchased on account for $30,000. Credit terms were 3/10, 1/30. Payment was made within the discount period and the company records the purchases of equipment net of discounts. 2. Connors gave the seller a noninterest-bearing note. The note required payment of $32,000 one year from date of purchase. The fair value of the equipment is not determinable. An interest rate of 12% properly reflects the time value of money in this situation. 3. Connors traded in old equipment that had a book value of $8,500 (original cost of $19,000 and accumulated depreciation of $10,500) and paid cash of $27,000. The old equipment had a fair value of $4,500 on the date of the exchange. The exchange has commercial substance. 4. Connors issued 1,500 shares of its no-par common stock in exchange for the equipment. The market…
- XYZ Company, a calendar year business, purchased machinery on February 2, 2016. The purchase price of the machinery was $90,000 and the machinery was subject to a 7% sales tax on the purchase price. The company paid $1,500 to have the machinery delivered and set up at its factory. What is the initial basis of the asset?Connors Corporation acquired manufacturing equipment for use in its assembly line. Below are four independent situations relating to the acquisition of the equipment. 1. The equipment was purchased on account for $25,000. Credit terms were 2/10, n/30. Payment was made within the discount period and the company records the purchases of equipment net of discounts. 2. Connors gave the seller a noninterest-bearing note. The note required payment of $27,000 one year from date of purchase. The fair value of the equipment is not determinable. An interest rate of 10% properly reflects the time value of money in this situation. 3. Connors traded in old equipment that had a book value of $6,000 (original cost of $14,000 and accumulated depreciation of $8,000) and paid cash of $22,000. The old equipment had a fair value of $2,500 on the date of the exchange. The exchange has commercial substance. 4. Connors issued 1,000 shares of its nopar common stock in exchange for the equipment. The market…On January 1, 2021 Simon Co. purchased an item of equipment for P600,000, including P50,000 refundable purchase taxes. The purchase price was funded by raising a loan of P605,000. In addition, the entity has to pay P5,000 in loan raising fees to the Bank. The loan is secured against the equipment. In January 2021 the entity incurred costs of P20,000 in transporting the equipment to the entity’s site and P100,000 in installing the equipment at the site. At the end of the equipment’s 10-year useful life the entity is required to dismantle the equipment and restore the building housing the equipment. The present value of the cost of dismantling the equipment and restoring the building is estimated to be P100,000. In January 2021 the entity’s engineer incurred the following costs in modifying the equipment so that it can produce the products manufactured by the entity: • Materials – P55,000 • Labour – P65,000 • Depreciation of plant and equipment used to perform the modifications –…