Distinguishing between cost and expenses Below are descriptions of various resource ac- quisitions by the Doltone Products Company during the year. The company uses straight-line depreciation for all fixed assets.

a. Paid a contractor $550 for snow removal from parking lot.

b. Purchased a three year fire insurance policy for $5,400 on November 1.

c. Purchased new computer equipment for the office on July 1 for $120,000. Cash of $40,000 is paid and a $80,000 three year note payable is issued. The equipment has an expected useful life of five years and a salvage value of $10,000.

d. Bought a new front-end loader on May 1 with a list price of $130,000. The company paid $85,000 cash and traded in an old front-end loader that had a market value of $35,000. The new equipment has an expected useful life of 5 years and salvage value of $40,000.

e. Received a bill of $900 on October 15 for September lawn care services.

f. On November 1 purchased a one-year maintenance agreement on the new computer equip- ment for $4,800.

g. Bought a $1,200 six month maintenance agreement on June 1 for conveyor belt equipment used in the finished goods warehouse.

h. Traded land valued at $70,000 for a large parking lot of equal value that is adjacent to the plant.

REQUIRED For each transaction identify the amount of cost and the amount of expense for the year.