Pina Co. both purchases and constructs various equipment it uses in its operations. The following items for two different types of equipment were recorded in random order during the calendar year 2020. Purchase Cash paid for equipment, including sales tax of $5,600 $117,600 Freight and insurance cost while in transit 2,240 Cost of moving equipment into place at factory 3,472 Wage cost for technicians to test equipment 4,480 Insurance premium paid during first year of operation on this equipment 1,680 Special plumbing fixtures required for new equipment 8,960 Repair cost incurred in first year of operations related to this equipment 1,456 Construction Material and purchased parts (gross cost $224,000; failed to take 2% cash discount) $224,000 Imputed interest on funds used during construction (stock financing) 15,680 Labor costs 212,800

At the end of the reporting period, Pinky Corp. shows the following account for machinery it had assembled for its own use during the period: Cash paid for equipment, including VAT of P9,600 Insurance costs for current year 89,600 1,500 Cost of dismantling old machine 14,480 Cash proceeds from sale of old machine 12,000 Raw materials used in construction of new machine 76,000 Labor on construction of new machine 49,000 Cost of installation 11,200 Costs of water devices to keep machine cool 8,000 Materials spoiled in machine trial runs 2,400 Profit on construction 24,000 Purchase of machine tools 13,000 Costs of adjustments to machine to make it operate more efficiently 7,500 An analysis of the details in the account disclosed the following: a. Cash discounts received on the payments for materials used in construction totaled P3,000, and these were reported in the purchase discounts account. b. The factory overhead account shows a balance of P292,000 for the current period; this balance…

Carla Engineering Corporation purchased conveyor equipment with a list price of $9,200. Presented below are three independent cases related to the equipment. (a)   Carla paid cash for the equipment 8 days after the purchase. The vendor’s credit terms are 2/10, n/30. Assume that equipment purchases are initially recorded gross. (b)   Carla traded in equipment with a book value of $2,200 (initial cost $7,400), and paid $9,800 in cash one month after the purchase. The old equipment could have been sold for $300 at the date of trade. (The exchange has commercial substance.) (c)   Carla gave the vendor a $11,000 zero-interest-bearing note for the equipment on the date of purchase. The note was due in one year and was paid on time. Assume that the effective-interest rate in the market was 9%. Prepare the general journal entries required to record the acquisition and payment in each of the independent cases above. (Round present value factor calculations to 5 decimal places, e.g.…

Wildhorse Company purchased a delivery truck. The total cash payment was $36,270, including the following items. Negotiated purchase price Installation of special shelving Painting and lettering Motor vehicle license Annual insurance policy Sales tax Total paid $31,200 1,430 1,170 130 650 1,690 $36,270 Calculate the cost of the truck and the operating costs of the truck.

During 2025 Ivanhoe Corporation had the following transactions: 1. Oil and filter change on company truck $380. 2. Interior painting of office building $2,160. 3. Purchase of new equipment $32,400. 4. Shipping costs on purchase of new equipment $1,240. 5. Installation and testing costs on new equipment $2,000. 6. Repaired building roof $1,460. 7. Engine overhaul on company truck $4,320 (Use Vehicles.). 8. Purchase of a one-year insurance policy on equipment $1,240. 9. Paving of parking lot and driveway $8,100. 10. Purchased supplies of $540. Prepare the appropriate journal entries determining whether the transaction is an operating or capital expenditure. Assume cash payments on all transactions.

Global Traders purchases a piece of equipment for $1.5 million and incurs the following expenses: Freight charges = $250,000 Installation charges = $25,000 Cost of training machine maintenance staff = $12,000 Cost of strengthening the factory floor = $5,500 Cost of painting factory walls = $7,000 The amounts capitalized and expensed by the company are closest to: Balance Sheet ($) A 1,775,000 B 1,780,500 C 1,792,500 O Row B Row C Row A Income Statement ($) 24,500 19,000 7,000

Worf Co. both purchases and constructs various equipment it uses in its operations. The following items for two different types of equipment were recorded in random order during the calendar year 2020. Purchase Cash paid for equipment, including sales tax of $5,000 $105,000 Freight and insurance cost while in transit 2,000 Cost of moving equipment into place at factory 3,100 Wage cost for technicians to test equipment 4,000 Insurance premium paid during first year of operation on this equipment 1,500 Special plumbing fixtures required for new equipment 8,000 Repair cost incurred in first year of operations related to this equipment 1,300 Construction Material and purchased parts (gross cost $200,000; failed to take 2% cash discount) $200,000 Imputed interest on funds used during construction (stock financing) 14,000 Labor costs 190,000 Allocated overhead costs (fixed—$20,000; variable—$30,000) 50,000 Profit on self-construction 30,000…

Wiater Company operates a small manufacturing facility. On January 1, 2021, an asset account for the company showed the following balances: Equipment Accumulated Depreciation (beginning of the year) $ 344,000 212,000 During the first week of January 2021, the following cash expenditures were incurred for repairs and maintenance: Routine maintenance and repairs on the equipment Major overhaul of the equipment that improved efficiency $ 3,550 41,000 The equipment is being depreciated on a straight-line basis over an estimated life of 15 years with a $26,000 estimated residual value. The annual accounting period ends on December 31. Required: - Indicate the effects (accounts, amounts, and + for increase and – for decrease) of the following two items on the accounting equation, using the headings shown below. (Enter any decreases to Assets, Liabilities or Stockholder's Equity with a minus sign.) 1. The adjustment for depreciation made last year at the end of 2020. 2. The two expenditures…

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