William Manufacturing Inc. purchased a new machine and made the following payments related to its purchase: Gross Purchase Price = $850,000 Sales Tax $58,000 Purchase Discount Taken = $25,000 Freight Cost (FOB Shipping Point) = $4,200 Normal Assembly Costs = $3,500 Cost of Necessary Machine Platform = $3,000 Cost of Parts Used in Maintaining the Machine = $5,000 Determine the total recorded cost of the new machine.

William Manufacturing Inc. purchased a new machine and made the following payments related to its purchase: Gross Purchase Price = $850,000 Sales Tax $58,000 Purchase Discount Taken = $25,000 Freight Cost (FOB Shipping Point) = $4,200 Normal Assembly Costs = $3,500 Cost of Necessary Machine Platform = $3,000 Cost of Parts Used in Maintaining the Machine = $5,000 Determine the total recorded cost of the new machine.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter11: Long-term Assets

Section: Chapter Questions

Problem 4EB: Montello Inc. purchases a delivery truck for $25,000. The truck has a salvage value of $6,000 and is...

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Montello Inc. purchases a delivery truck for $25,000. The truck has a salvage value of $6,000 and is expected to be driven for 125,000 miles. Montello uses the units-of-production depreciation method, and in year one the company expects the truck to be driven for 26,000 miles; in year two, 30,000 miles; and in year three, 40,000 miles. Consider how the purchase of the truck will impact Montellos depreciation expense each year and what the trucks book value will be each year after depreciation expense is recorded.
Ronson recently purchased a new boat to help ship product overseas. The following information is related to that purchase: purchase price $4,500,000 cost to bring boat to production facility $15,000 yearly insurance cost $12,000 pays annual maintenance cost of $22,000 received a 10% discount on sales price Determine the acquisition cost of the boat and record the journal entry needed.
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Josiah Co acquired a new machine. Details of the acquisition are as follows: Purchase price including VAT 1,568,000 Cost of water device to keep machine cool 8,000 Cost of safety rail and platform surrounding machine 12,000 Installation cost, including site preparation and assembling 20,000 Fees paid to consultants for advice on acquisition of the machinery 13,000 Present value of the estimated dismantling cost of the new machine 10,000 Repair cost of the machine damaged while in the process of installation 5,000 Loss on premature retirement-old machine 18,000 Other nonrefundable sales tax 13,000 Cost of training for personnel who will use the machine 25,000 Cost of removing old machine 10,000 Determine the cost of the Machinery
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