Holiday Laboratories purchased a high-speed industrial centrifuge at a cost of $410,000. Shipping costs totaled $13,700. Foundation work to house the centrifuge cost $9,300. An additional water line had to be run to the equipment at a cost of $3,800. Labor and testing costs totaled $4,300. Materials used up in testing cost $2,000. (Leave no cells blank. Enter 0 where needed.) Required: 1. What is the total capitalized cost of the equipment? 2. How much of this amount should be expensed immediately?

Holiday Laboratories purchased a high-speed industrial centrifuge at a cost of $410,000. Shipping costs totaled $13,700. Foundation work to house the centrifuge cost $9,300. An additional water line had to be run to the equipment at a cost of $3,800. Labor and testing costs totaled $4,300. Materials used up in testing cost $2,000. (Leave no cells blank. Enter 0 where needed.) Required: 1. What is the total capitalized cost of the equipment? 2. How much of this amount should be expensed immediately?

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter3: Cost Behavior

Section: Chapter Questions

Problem 13E

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