Kegler Bowling buys scorekeeping equipment with an invoice cost of $185,000. The electrical work required for the installation costs $19,425. Additional costs are $3,885 for delivery and $13,330 for sales tax. During the installation, the equipment was damaged and the cost of repair was $1,795.
Required:
a. What is the total recorded cost of the scorekeeping equipment?

Respuesta :

Answer:

The total recorded cost of score-keeping equipment is $221,610  

Explanation:

The cost of score-keeping equipment comprises of the invoice cost of the equipment,installation costs,delivery and sales tax incurred on the purchase since the sales tax is not recoverable from relevant tax authority

The cost of equipment is computed thus:

Invoice price                           $185,000

Installation cost                        $19,425

Delivery costs                           $3,885

Sales tax                                   $13,300

Total cost                                $221,610  

The repair cost is not included as it is expected to expensed as incurred by recognizing it in income statement