Kegler Bowling buys scorekeeping equipment with an invoice cost of $175,000. The electrical work required for the installation costs $18,200. Additional costs are $3,640 for delivery and $12,600 for sales tax. During the installation, the equipment was damaged and the cost of repair was $1,700. Required: Indicate whether each cost should be included in the cost of the equipment or excluded and expensed as incurred. Costs Invoice cost Electrical work required for installation Delivery costs Sales tax Repair costs Total recorded cost Amount $ Included or Excluded 175,000 Included 18,200 Included 3,640 Included 12,600 Included 1,700 Excluded $ 209,440 Account DR Expense DR Machinery DR Expense DR Expense DR Expense
Kegler Bowling buys scorekeeping equipment with an invoice cost of $175,000. The electrical work required for the installation costs $18,200. Additional costs are $3,640 for delivery and $12,600 for sales tax. During the installation, the equipment was damaged and the cost of repair was $1,700. Required: Indicate whether each cost should be included in the cost of the equipment or excluded and expensed as incurred. Costs Invoice cost Electrical work required for installation Delivery costs Sales tax Repair costs Total recorded cost Amount $ Included or Excluded 175,000 Included 18,200 Included 3,640 Included 12,600 Included 1,700 Excluded $ 209,440 Account DR Expense DR Machinery DR Expense DR Expense DR Expense
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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