Our company paid 236,000 TL including 18% VAT to the seller for the machine it acquired to use in its activities, 21,240 TL including 18% VAT to the transport company for its transportation, and 15,000 TL for the assembly of the machine, excluding 18% VAT. What is the total cost of the relevant machine to the enterprise according to the cost cost measure? a) 253,700 TL B) 274,940 TL NS) 257,240 TL D) 233,000 TL TO) 200.000 TL
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Our company paid 236,000 TL including 18% VAT to the seller for the machine it acquired to use in its activities, 21,240 TL including 18% VAT to the transport company for its transportation, and 15,000 TL for the assembly of the machine, excluding 18% VAT. What is the total cost of the relevant machine to the enterprise according to the cost cost measure? |
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This question deals with the calculation of relevant cost of total machine to enterprise.
As per the IAS 16 "Property plant and equipment",
All the cost which are necessary to bring the asset to its working condition are needs to be capitalized.
There cost not only includes purchase price but it also includes,
- Delivery and handling cost
- Installation and site preparation costs
- Legal costs
When purchase cost and other cost related to bringing the asset to its current position for its use contains tax with it and if these taxes are available as credit back then that taxes can not be taken as a cost of asset.
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