Sandhill Co. both purchases and constructs various equipment it uses in its operations. The following...
70.2K
Verified Solution
Link Copied!
Question
Accounting
Sandhill 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 $6,400 | $134,400 |
| Freight and insurance cost while in transit | 2,560 |
| Cost of moving equipment into place at factory | 3,968 |
| Wage cost for technicians to test equipment | 5,120 |
| Insurance premium paid during first year of operation on this equipment | 1,920 |
| Special plumbing fixtures required for new equipment | 10,240 |
| Repair cost incurred in first year of operations related to this equipment | 1,664 |
| Construction | |
| Material and purchased parts (gross cost $256,000; failed to take 2% cash discount) | $256,000 |
| Imputed interest on funds used during construction (stock financing) | 17,920 |
| Labor costs | 243,200 |
| Allocated overhead costs (fixed-$25,600; variable-$38,400) | 64,000 |
| Profit on self-construction | 38,400 |
| Cost of installing equipment | 5,632 |
Compute the total cost to be capitalized for each of these two pieces of equipment.
| Purchase equipment: | $??? |
|---|
| Construction equipment: | $??? |
|---|
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
- Unlimited Question Access with detailed Answers
- Zin AI - 3 Million Words
- 10 Dall-E 3 Images
- 20 Plot Generations
- Conversation with Dialogue Memory
- No Ads, Ever!
- Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.