Kegler Bowling buys scorekeeping equipment with an invoice cost of $150,000. The electrical work required for the installation costs $15,750. Additional costs are $3,150 for delivery and $10,810 for sales tax. During the installation, the equipment was damaged and the cost of repair was $1,455. 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 150,000 [included 15,750 included 3,150 included 10,810 Included 1,455 Excluded $ 154,605 Account Debit Machinery Debit Machinery Debit Machinery Debit Machinery Debit Expense

Kegler Bowling buys scorekeeping equipment with an invoice cost of $150,000. The electrical work required for the installation costs $15,750. Additional costs are $3,150 for delivery and $10,810 for sales tax. During the installation, the equipment was damaged and the cost of repair was $1,455. 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 150,000 [included 15,750 included 3,150 included 10,810 Included 1,455 Excluded $ 154,605 Account Debit Machinery Debit Machinery Debit Machinery Debit Machinery Debit Expense

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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Kegler Bowling buys scorekeeping equipment with an invoice cost of $190,000. The electrical work required for the installation costs $20,000. Additional costs are $4,000 for delivery and $13,700 for sales tax. During the installation, the equipment was damaged and the cost of repair was $1,850. What is the total recorded cost of the scorekeeping equipment?
An air-conditioning system is installed in a building under construction. Thebill for installation is the cost of the parts plus overhead plus sales tax. Theoverhead is 75% of the cost of the parts. The parts cost $3,500. The sales taxis 4% of the cost of parts plus overhead.a. Find the cost of the overhead.b. Find the sales tax.c. Find the total amount of the bill.
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Rizio Company purchases a machine for $14,800, terms 2/10, n/60, FOB shipping point. Rizio paid within the discount period and took the $296 discount. Transportation costs of $334 were paid by Rizio. The machine required mounting and power connections costing $1,023. Another $482 is paid to assemble the machine, and $40 of materials are used to get it into operation. During installation, the machine was damaged and $350 worth of repairs were made. Complete the below table to calculate the cost recorded for this machine. Amount Included in Cost of Equipment: Invoice price of machine Net purchase price Total cost to be recorded
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