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 Freight and insurance cost while in transit Cost of moving machinery into place at factory Wage cost for technicians to test machinery Materials cost for testing Insurance premium paid on the machinery for its first year of operation Special plumbing fixtures required for new machinery Repair cost on machinery incurred in first year of operations Cash received from provincial government as incentive to purchase machinery Profit on self-construction Cost of installing equipment Calculate the cost of the machinery and the cost of the equipment. Equipment (Self-Constructed) Material and purchased parts (gross cost $219,000; failed to take 3% cash discount; the company uses the net method of recording purchases of material and parts) Imputed interest on funds used during construction (Note: The company has no borrowing costs but it has calculated imputed interest on its equity/ share financing) Labour costs for manufacturing the equipment Overhead costs (fixed $22,700; variable $29,400) (a) Cost of the machinery (b) Cost of the equipment $162,400 2,450 3,400 3,800 560 $ 1,600 8,260 1,200 27,000 $219,000 14,300 193,000 52,100 32,200 4,600

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