On August 28, 2016, Saturn Drilling Services purchased a machine with a contract price of $400,000...
On August 28, 2016, Saturn Drilling Services purchased a machine with a contract price of $400,000 and cash terms of 2/10, n/30. The company paid $8,000 in transportation costs and $8,000 for installation. Sales taxes of $22,000 were paid on the invoice amount. The machine should be recorded as a plant asset in the amount of...
A). $428,000
B). $422,000
C). $430,000
D). $400,000
Homework Answers
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Amount to be capitalized = Net purchase price + Transportation cost + Installation + Sales taxes = (400,000-2%) + 8,000+8000+22000 = 430,000 Option c |
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On August 28, 2016, Saturn Drilling Services purchased a machine
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