1. Kemp Company purchased factory equipment with an invoice price of 85,000. Other costs incurred were freight costs, 1,100; installation wiring and foundation, 2,200; material and labor costs in testing equipment, 700; oil lubricants and supplies to be used with equipment, 500; fire insurance policy covering equipment, 1,400. The equipment is estimated to have a 5,000 residual value at the end of its 10- year useful service life. Instructions (a) Compute the acquisition cost of the equipment. Clearly identify each element of cost. (b) If the double-declining-balance method of depreciation was used, the constant percentage applied to a declining book value would be 2. For each entry below make a correcting entry if necessary. If the entry given is correct, then state "No entry required." (a) The $60 cost of repairing a printer was charged to Equipment. (b) The $5,000 cost of a major engine overhaul was debited to Maintenance and Repairs Expense. The overhaul is expected to increase the operating efficiency of the equipment. (c) The $6,000 closing costs associated with the acquisition of land were debited to Legal Expense. (d) A $500 charge for transportation expenses on new equipment purchased was debited to Freight-In.