What is the initial cost of the machine? And why? a. 2,000,000b. 2,400,000c. 2,050,000d. 2,450,000 Maya Mang Co. entered into a contract to acquire a new machinewhich had a cash price of Php2,000,000Downpayment400,000.00Note Payable in 3 equal annual installments200,000 ordinary shares with a par value of1,200,000.00Php25 and fair value of Php40 per share800,000.002,400,000.00Prior to use, installation cost of Php50,000 was incurred. The machinehas an estimated residual value of Php100,000.

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What is the initial cost of the machine? And why? a. 2,000,000 b. 2,400,000 c. 2,050,000 d. 2,450,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

What is the initial cost of the machine? And why?

a. 2,000,000

b. 2,400,000

c. 2,050,000

d. 2,450,000

Maya Mang Co. entered into a contract to acquire a new machine
which had a cash price of Php2,000,000
Downpayment
400,000.00
Note Payable in 3 equal annual installments
200,000 ordinary shares with a par value of
1,200,000.00
Php25 and fair value of Php40 per share
800,000.00
2,400,000.00
Prior to use, installation cost of Php50,000 was incurred. The machine
has an estimated residual value of Php100,000.

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