Manny Company uses many kinds of machines in its operations. The following information relates to a machine that was acquired at the beginning of the current year: Cash paid for machine, including VAT of P96,000 Cost of transporting machine Labor cost of installation by expert fitter Labor cost of testing machine Insurance cost for the current year Cost of training for personnel who will use the machine Cost of safety rails and platform surrounding machine Cost of water device to keep machine cool Cost of adjustment to machine to make it operate more efficiently Estimated dismantling cost to be incurred as required by contract 896,000 30,000 50,000 40,000 15,000 25,000 60,000 80,000 75,000 65,000 What total amount should be capitalized as cost of the machine?
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- Manny Company uses many kinds of machines in its operations. The following information relates to a machine that was acquired at the beginning of the current year: Cash paid for machine, including VAT of P96,000 Cost of transporting machine Labor cost of installation by expert fitter Labor cost of testing machine Insurance cost for the current year Cost of training for personnel who will use the machine Cost of safety rails and platform surrounding machine Cost of water device to keep machine cool Cost of adjustment to machine to make it operate more efficiently Estimated dismantling cost to be incurred as required by contract 896,000 30,000 50,000 40,000 15,000 25,000 60,000 80,000 75,000 65,000 What total amount should be capitalized as cost of the machine?Stella Company uses many kinds of machines in its operations. The following information relates to a machine that was acquired at the beginning of the current year: Cash paid for machine, including VAT of P96,000 Cost of transporting the machine Labor cost of installation by expert fitter 896,000 30,000 50,000 Labor cost of testing machine Cost of safety rails and platform surrounding machine Cost of water device to keep machine cool 40,000 60,000 80,000 Cost of adjustment to machine to make it operate more efficiently Estimated dismantling cost to be incurred as required by contract Insurance cost for the current year 75,000 65,000 15,000 Cost of training personnel who will use the machine 25,000 How much should be capitalized as cost of the machine?JOOVI Inc. has recently purchased and installed a new machine for its manufacturingplant. Th e company incurred the following costs:Purchase price $12,980Freight and insurance $1,200Installation $700Testing $100Maintenance staff training costs $500Th e total cost of the machine to be shown on JOOVI’s balance sheet is closest to:A. $14,180.B. $14,980.C. $15,480.
- Tutor Corp. uses different kinds of machines in its manufacturing process. The following information relates to the acquisition of machines that it has recorded in 2021.· Cash paid for equipment- P250,000· Cost of transporting machine - insurance and transport- P9,000· Labor cost of installation by expert fitter- P15,000· Labor cost of testing equipment- P12,000· Insurance cost for 2021- P4,500· Cost of training for personnel who will use the machine- P7,500· Cost of safety rails and platforms surrounding machine- P18,000· Cost of water devices to keep machine cool- P24,000· Cost of adjustments to machine during 2021 to make it operate more efficiently- P22,500 What is the cost of the machine?Angel Corp. uses different kinds of machines in its manufacturing process. The following information relates to the acquisition of machines that it has recorded in 2021.· Cash paid for equipment- P250,000· Cost of transporting machine - insurance and transport- P9,000· Labor cost of installation by expert fitter- P15,000· Labor cost of testing equipment- P12,000· Insurance cost for 2021- P4,500· Cost of training for personnel who will use the machine- P7,500· Cost of safety rails and platforms surrounding machine- P18,000· Cost of water devices to keep machine cool- P24,000· Cost of adjustments to machine during 2021 to make it operate more efficiently- P22,500 What is the cost of the machine? A. 358,000 B. 328,000 C. 350,500 D. 380,500Invaders Ltd recently purchased a cutting machine from one of its suppliers. The machine was purchased on 01 March 2019 and brought into use on 01 May 2019. The financial year end of the company is 28 February. The following costs were incurred relating to the purchase of the machine: Purchase Price Delivery costs Administration costs Import duties (non-refundable) Staff party to celebrate the acquisition of the new machine Testing to ensure that machine is fully operational Installation costs The following table indicates the number of units produced over a 3-month period: March-May 2019 150 000 units June-August 2019 220 000 units 180 000 units 230 000 units 195 000 units 232 000 units 180 000 units 255 000 units September-November 2019 December-February 2020 March-May 2020 June-August 2020 September-November 2020 December-February 2021 Rand The machine has a residual value of R80 000 and will be depreciated using the units of production method. The machine is expected to produce a…
- BolaBola uses different kinds of machines in its manufacturing process. The following information relates to the acquisition of machines that it has recorded in 2020.· Cash paid for equipment- P250,000· Cost of transporting machine - insurance and transport- P9,000· Labor cost of installation by expert fitter- P15,000· Labor cost of testing equipment- P12,000· Insurance cost for 2020- P4,500· Cost of training for personnel who will use the machine- P7,500· Cost of safety rails and platforms surrounding machine- P18,000· Cost of water devices to keep machine cool- P24,000· Cost of adjustments to machine during 2020 to make it operate more efficiently- P22,500 What is the cost of the machine?Dorman company purchased a new machine for its production process. The following costs were incurred for the new machine. Training costs for workers who will operate the machine $15,000 Wages paid to workers who operate the machine during production 109,000 Ordinary repairs to the machine before the first production run 1,000 1 Cost of platform used to properly secure the machine 30,000 Costs of tests run which took place before the first production run 8,000 WHICH COSTS SHOULD BE ADDED TO THE COST OF MACHINE?At the beginning of the year, CCZ Corporation bought three used machines from Pequita Compression Incorporated. The machines immediately were overhauled, installed, and started operating. Because the machines were different from each other, each was recorded separately in the accounts. Machine A Machine B Machine C Cost of the asset $ 10,040 $ 28,340 $ 22,200 Installation costs 1,620 2,120 820 Renovation costs prior to use 620 1,420 1,620 Repairs after production began 520 420 720 By the end of the first year, each machine had been operating 7,200 hours. Required:1-a. Compute the cost of each machine. 1-b. Which of the following should be capitalized? (Select all that apply.) 2. Prepare the journal entry to record depreciation expense at the end of year 1, assuming the following: (If no entry is required for a transaction/event, select "No journal entry required" in the first account field.)…
- The following data relate to a firm's purchase of a machine used in the manufacture of its product: Invoice price $20,000 Applicable sales tax Cash discount taken for prompt payment 1,200 400 Freight paid 260 Cost of insurance coverage on machine while in transit 125 Installation costs 1,000 Testing and adjusting costs 475 Repair of damages to machine caused by the firm's employees 550 Prepaid maintenance contract for first year of machine's use 300 Determine the acquisition cost of the machine. $ 23,510Shaw Company purchased a machine for P 1 260 000 that was placed in service at year – end. The entity incurred additional costs for this machine. Shipping 30 000 Installation 40 000 Testing 50 000 At year end, what amount should be reported as machinery?Requireu iIONiation Use the following information for the Exercises below. [The following information applies to the questions displayed below.] Ramirez Company installs a computerized manufacturing machine in its factory at the beginning of the year at a cost of $47,500. The machine's useful life is estimated at 10 years, or 405,000 units of product, with a $7,000 salvage value. During its second year, the machine produces 34,500 units of product. Exercise 8-5 Units-of-production depreciation LO P1 Determine the machine's second-year depreciation using the units-of-production method. Units-of-production Depreciation Choose Numerator: Choose Denominator: Annual Depreciation Expense %3D Depreciation expense per unit Year Annual Production (units) Depreciation Expense