1. Compute the amount recorded as the cost of a new machine used in

the production process of a company, given the following payments

related to its purchase:

Purchase Price $700,000

Sales Tax $ 50,000

Purchase Discount Taken $ 10,000

Transit Costs $ 2,500

Assembly & Testing Costs $ 5,000

Cost of Necessary Machine Platform $ 2,500

Cost of Maintenance Parts for All Machines $ 4,200

Calculate the cost of the machine that should be capitalized.

A machine costing $22,000 with a 5-year life and estimated

salvage value of $2,000 is installed on January 1. Calculate the

straight-line depreciation for the first year of the machines

life.

2. A company owns a production machine that cost $5,000 with a salvage

value of zero. The machine was just sold for $1,100. Accumulated

depreciation has just been updated and accurately reflects an amount

of $4,000. In good order and form record the necessary General Journal

entry to dispose of the machine.

The net sales for a company are $959.9 million. Its average total

assets at year-end are $625.3 million. To four decimal places,

calculate the Total Asset Turnover for the company.