Acquisition Cost of Long-Lived Asset The following data relate to a firm's purchase of a machine used in the manufacture of its product: Invoice price Applicable sales tax Cash discount taken for prompt payment Freight paid Cost of insurance coverage on machine while in transit Installation costs 3,000 Testing and adjusting costs 475 Repair of damages to machine caused by the firm's employees 750 Prepaid maintenance contract for first year of machine's use 300 Determine the acquisition cost of the machine. Acquisition Cost = $ $30,000 2,000 400 260 125

Acquisition Cost of Long-Lived Asset The following data relate to a firm's purchase of a machine used in the manufacture of its product: Invoice price Applicable sales tax Cash discount taken for prompt payment Freight paid Cost of insurance coverage on machine while in transit Installation costs 3,000 Testing and adjusting costs 475 Repair of damages to machine caused by the firm's employees 750 Prepaid maintenance contract for first year of machine's use 300 Determine the acquisition cost of the machine. Acquisition Cost = $ $30,000 2,000 400 260 125

Intermediate Accounting: Reporting And Analysis

3rd Edition

ISBN:9781337788281

Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach

Chapter12: Intangibles

Section: Chapter Questions

Problem 4C

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