snju Southwest Milling Company purchased a front-end loader to move stacks of lumber. The loader had a list price of $118,870. The selleragreed to allow a 4.50 percent discount because Southwest Milling paid cash. Delivery terms were FOB shipping point. Transportationcost amounted to $2,640. Southwest Milling had to hire a specialist to calibrate the loader. The specialist's fee was $810. The loaderoperator is paid an annual salary of $29,100. The cost of the company's theft insurance policy increased by $1,710 per year as a resultof acquiring the loader. The loader had a four-year useful life and an expected salvage value of $8,700.Required:Determine the amount to be capitalized in an asset account for the purchase of the front-end loader.Note: Round your answers to the nearest whole dollar. Amounts to be deducted should be indicated with minus sign.Costs that are to be capitalizedList priceTotal costs$

Capitalized expenses are an important part of financial reporting and accounting because they assist…

Answered: Southwest Milling Company purchased a…

Business

Accounting

Southwest Milling Company purchased a agreed to allow a 4.50 percent discount

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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Southwest Milling Co. purchased a front-end loader to move stacks of lumber. The loader had a list price of $122,380. The seller agreed to allow a 4.25 percent discount because Southwest Milling paid cash. Delivery terms were FOB shipping point. Freight cost amounted to $2,200. Southwest Milling had to hire a specialist to calibrate the loader. The specialist’s fee was $1,190. The loader operator is paid an annual salary of $42,940. The cost of the company’s theft insurance policy increased by $2,290 per year as a result of acquiring the loader. The loader had a four-year useful life and an expected salvage value of $5,500. Determine the amount to be capitalized in the asset account for the purchase of the front-end loader. What is the discount?
Southwest Milling Co. purchased a front-end loader to move stacks of lumber. The loader had a list price of $122,380. The seller agreed to allow a 4.25 percent discount because Southwest Milling paid cash. Delivery terms were FOB shipping point. Freight cost amounted to $2,200. Southwest Milling had to hire a specialist to calibrate the loader. The specialist’s fee was $1,190. The loader operator is paid an annual salary of $42,940. The cost of the company’s theft insurance policy increased by $2,290 per year as a result of acquiring the loader. The loader had a four-year useful life and an expected salvage value of $5,500. Determine the amount to be capitalized in the asset account for the purchase of the front-end loader. (Round your answers to the nearest whole dollar. Amounts to be deducted should be indicated with minus sign.)
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Saad Company is planning to purchase a machine having an invoice price of Rs. 49,000. The terms of sale were 2/10, n/30, and Harvard paid within the discount period. In addition, Company paid a Rs. 500 delivery charge, Rs. 400 installation charge, and Rs.1000 sales tax. The amount recorded as the cost of this equipment is:
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