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Answered

Rizio Co. purchases a machine for $9,600, terms 2/10, n/60, FOB shipping point. Rizio paid within the discount period and took the $192 discount. Transportation costs of $217 were paid by Rizio. The machine required mounting and power connections costing $664. Another $313 is paid to assemble the machine and $40 of materials are used to get it into operation. During installation, the machine was damaged and $245 worth of repairs were made.

Required:
Compute the cost recorded for this machine.

Answer :

Abiolataiwo2015go

Answer:

$10,642

Explanation:

Computation to determine the cost recorded for this machine.

Amount included in the cost of equipment

Invoice price of machine $9,600

Less: Discount (9600 x 2%) ($192)

Net purchase price $9,408

($9,600-$192)

Freight charges $217

Mounting and power connections $664

Assembly $313

Materials used in adjusting $40

Total cost to be recorded $10,642

Therefore the cost recorded for this machine is $10,642

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