Exercise 8-4A (Algo) Determining the cost of an asset LO 8-1 Southwest Miling Company purchased a front-end loader to move stacks of lumber. The loader had a list price of $124,470. The seller agreed to allow a 5.50 percent discount because Southwest Miling paid cash. Delivery terms were FOB shipping point. Transportation cost amounted to \$2,510. Southwest Milling had to hire a specialist to calbbrate the loader. The specialist's fee was $1,110. The loader operator is paid an annual salary of $29,800. The cost of the company's theft insurance policy increased by $2,480 per year as a result of acquiring the loadet. The loader had a four-year useful life and an expected salvage value of $5,500. Required: Determine the amount to be capitalized in an asset account for the purchase of the front-end loader. Note: Round your onswers to the nearest whole dollar. Amounts to be deducted should be indicated with minus sign. Exercise 8-4A (Algo) Determining the cost of an asset LO 81 Southwest Milling Company purchased a front-end loader to move stacks of lumber. The loader had a list price of $124,470. The 5 eller agreed to allow a 5.50 percent discount because Southwest Milling paid cash. Dellvery terms were FOB shipping point. Transportation cost amounted to $2,510. Southwest Miling had to hire a specialist to calibrate the loader. The specialist's fee was $1,110. The loader operator is paid an annual salary of $29,800. The cost of the company's theft insurance policy increased by $2,480 per year as a result of acquiring the loader. The loader had a four-year useful life and an expected salvage value of $5,500. Required: Determine the amount to be capitalized in an asset account for the purchase of the front-end loader. Note: Round your answers to the nearest whole dollar. Amounts to be deducted should be indicated with minus sign. Exercise B-7A (Algo) Effect of depreciation on the accounting equation and financial statements LO 8-2. [The fallowing information applies to the questhons displayed below] The folowing events apply to Gulf Seafood for the Yeat 1 fiscal year: 1. The company started when it acquired $8,000 cash by issuing common stock 2. Purchased a new cooktop that cost $17000 cash. 3. Eamed $23,000 in cash revenue, 4. Paid $12400 cash for salaries expense. 5. Adjusted the records to reflect the use of the cooktop. Purchased on January 1, Year 1, the cooktop has an expected useful life of four years and an estimated salvage value of $2,600. Use straight-ine depreciation. The adjustment was made as of December 31, Year 1 . Exercise 8-7A (Algo) Part a Required: a. Record the above transactions in a horizontal statements model. Note: In the Stotement of Cosh Flows column, use the initials (OA), an investing octivity (IA), of financing activity (FA) and net change in cosh (NC). Enter ony decreases to occount bolances and cash outflows with a minus sign. Not all cells require input. Exercise 8-17A (Algo) Effect of revenue expenditures versus capital expenditures on financial statements LO 8-8 Sellers Construction Company purchased a compressor for $101.400 cash it had an estimated useful life of four years and a $10,000 salvage value. At the beginning of the third year of use, the company spent an additional $9,220 related to the equipment. The company's financial condition just prior to this expenditure is shown in the following statements model: Required Record the $9,220 expenditure in the statements model under each of the following independent assumptions: Note: In the Statement of Cash Flows column, use the initials "OA" for operating activities, "FA" for financing activities, and "IA" for investing activity. Enter any decreases to account balances and cash outflows with a minus sign. Not all cells require input. a. The expenditure was for routine maintenance. b. The expenditure extended the compressor's life. c. The expenditure improved the compressor's operating capacity
