Southwest Milling Company purchased a front-end loader to move stacks of lumber. The loader had a list price of $119,810. The seller agreed to allow a 5.25 percent discount because Southwest Milling paid cash. Delivery terms were FOB shipping point. Freight cost amounted to $2,880. Southwest Milling had to hire a specialist to calibrate the loader. The specialist's fee was $1,090. The loader operator is paid an annual salary of $6,020. The cost of the company's theft insurance policy increased by $1,950 per year as a result of acquiring the loader. The loader had a four-year useful life and an expected salvage value of $11,500. Required Determine the amount to be capitalized in the asset account for the purchase of the front-end loader. Note: Round your answers to the nearest whole dollar. Amounts to be deducted should be indicated with minus sign. Costs that are to be capitalized: List price Total costs 69 $ 0
Southwest Milling Company purchased a front-end loader to move stacks of lumber. The loader had a list price of $119,810. The seller agreed to allow a 5.25 percent discount because Southwest Milling paid cash. Delivery terms were FOB shipping point. Freight cost amounted to $2,880. Southwest Milling had to hire a specialist to calibrate the loader. The specialist's fee was $1,090. The loader operator is paid an annual salary of $6,020. The cost of the company's theft insurance policy increased by $1,950 per year as a result of acquiring the loader. The loader had a four-year useful life and an expected salvage value of $11,500. Required Determine the amount to be capitalized in the asset account for the purchase of the front-end loader. Note: Round your answers to the nearest whole dollar. Amounts to be deducted should be indicated with minus sign. Costs that are to be capitalized: List price Total costs 69 $ 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
A10 please help.....
Transcribed Image Text:Southwest Milling Company purchased a front-end loader to move stacks of lumber.
The loader had a list price of $119,810. The seller agreed to allow a 5.25 percent
discount because Southwest Milling paid cash. Delivery terms were FOB shipping
point. Freight cost amounted to $2,880. Southwest Milling had to hire a specialist to
calibrate the loader. The specialist's fee was $1,090. The loader operator is paid an
annual salary of $6,020. The cost of the company's theft insurance policy increased
by $1,950 per year as a result of acquiring the loader. The loader had a four-year
useful life and an expected salvage value of $11,500.
Required
Determine the amount to be capitalized in the asset account for the purchase of the
front-end loader.
Note: Round your answers to the nearest whole dollar. Amounts to be deducted
should be indicated with minus sign.
Costs that are to be capitalized:
List price
Total costs
69
$
0
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