Farha Co. purchases a machine for $11,500, terms 2/10, n/60, FOB shipping point. The seller pre paid
Question:
Farha Co. purchases a machine for $11,500, terms 2/10, n/60, FOB shipping point. The seller pre¬ paid the $260 freight charges, adding the amount to the invoice and bringing its total to $11,760. The machine requires special steel mounting and power connections costing $795. Another $375 is paid to assemble the machine and get it into operation. In moving the machine to its steel mounting, $190 in damages occurred. Also, $30 of materials is used in adjusting the machine to produce a satisfactory product. The adjustments are normal for this machine and are not the result of the damages. Compute the cost recorded for this machine. (Farha pays for this machine within the cash discount period.)
Step by Step Answer:
Fundamental Accounting Principles
ISBN: 9780072946604
17th Edition
Authors: Kermit D. Larson, John J Wild, Barbara Chiappetta