Oriole Corp., a public company located in Manitoba, both purchases and constructs various pieces of machinery and equipment that it uses in its operations. The following items are for machinery that was purchased and a piece of equipment that was constructed during the 2020 fiscal year: Machinery Cash paid for machinery, including sales tax of $10,150 and recoverable GST of $7,250 $162,400 Freight and insurance cost while in transit 2,820 Cost of moving machinery into place at factory 3,200 Wage cost for technicians to test machinery 3,900 Materials cost for testing 500 Insurance premium paid on the machinery for its first year of operation 1,900 Special plumbing fixtures required for new machinery 8,050 Repair cost on machinery incurred in first year of operations 1,000 Cash received from provincial government as incentive to purchase machinery 26,300 Equipment (Self-Constructed) Material and purchased parts (gross cost $190,000; failed to take 1% cash discount; the company uses the net method of recording purchases of material and parts) $190,000 Imputed interest on funds used during construction (Note: The company has no borrowing costs but it has 14,000 calculated imputed interest on its equity/share financing) Labour costs for manufacturing the equipment 195,000 Overhead costs (fixed $22,900; variable $30,700) Profit on self-construction Cost of installing equipment 53,600 29,300 4,400 Calculate the cost of the machinery and the cost of the equipment. (a) Cost of the machinery $ +A (b) Cost of the equipment $
Oriole Corp., a public company located in Manitoba, both purchases and constructs various pieces of machinery and equipment that it uses in its operations. The following items are for machinery that was purchased and a piece of equipment that was constructed during the 2020 fiscal year: Machinery Cash paid for machinery, including sales tax of $10,150 and recoverable GST of $7,250 $162,400 Freight and insurance cost while in transit 2,820 Cost of moving machinery into place at factory 3,200 Wage cost for technicians to test machinery 3,900 Materials cost for testing 500 Insurance premium paid on the machinery for its first year of operation 1,900 Special plumbing fixtures required for new machinery 8,050 Repair cost on machinery incurred in first year of operations 1,000 Cash received from provincial government as incentive to purchase machinery 26,300 Equipment (Self-Constructed) Material and purchased parts (gross cost $190,000; failed to take 1% cash discount; the company uses the net method of recording purchases of material and parts) $190,000 Imputed interest on funds used during construction (Note: The company has no borrowing costs but it has 14,000 calculated imputed interest on its equity/share financing) Labour costs for manufacturing the equipment 195,000 Overhead costs (fixed $22,900; variable $30,700) Profit on self-construction Cost of installing equipment 53,600 29,300 4,400 Calculate the cost of the machinery and the cost of the equipment. (a) Cost of the machinery $ +A (b) Cost of the equipment $
Chapter6: Deductions And Losses: In General
Section: Chapter Questions
Problem 38P
Related questions
Question
Transcribed Image Text:Oriole Corp., a public company located in Manitoba, both purchases and constructs various pieces of machinery and equipment that
it uses in its operations. The following items are for machinery that was purchased and a piece of equipment that was constructed
during the 2020 fiscal year:
Machinery
Cash paid for machinery, including sales tax of $10,150 and recoverable GST of $7,250
$162,400
Freight and insurance cost while in transit
2,820
Cost of moving machinery into place at factory
3,200
Wage cost for technicians to test machinery
3,900
Materials cost for testing
500
Insurance premium paid on the machinery for its first year of operation
1,900
Special plumbing fixtures required for new machinery
8,050
Repair cost on machinery incurred in first year of operations
1,000
Cash received from provincial government as incentive to purchase machinery
26,300
Equipment (Self-Constructed)
Material and purchased parts (gross cost $190,000; failed to take 1% cash discount; the company uses the net
method of recording purchases of material and parts)
$190,000
Imputed interest on funds used during construction (Note: The company has no borrowing costs but it has
14,000
calculated imputed interest on its equity/ share financing)
Labour costs for manufacturing the equipment
195,000
Overhead costs (fixed $22,900; variable $30,700)
Profit on self-construction
Cost of installing equipment
53,600
29,300
4,400
Calculate the cost of the machinery and the cost of the equipment.
(a)
Cost of the machinery
$
(b)
Cost of the equipment
$
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 4 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT
Individual Income Taxes
Accounting
ISBN:
9780357109731
Author:
Hoffman
Publisher:
CENGAGE LEARNING - CONSIGNMENT