12) Howard's Supply Co. suffered a fire loss on April 20,2018. The company's last physical 12) inventory was taken January 30, 2018, at which time the inventory totaled $220,000 Sales from January 30 to April 20 were $600,000 and purchases during that time were $450,000. Howard's consistently reports a 30% gross profit. The estimated inventory loss is: A) S250,000. B) $490,000. C) $238,000. D) None of these answer choices are correct 13) The capitalized cost of equipment excludes: A) C) Shipping 3 B) Installation D) Sales tax 14) The cost of constructing a new parking lot at the company's office building would be recorded as: A) Land C) Equipment 14) B) Building D) Land improvement 15) Montana Mining Co. (MMC) paid $200 million for the right to explore and extract rare 15) metals from land owned by the state of Montana. To obtain the rights, MMC agreed to restore the land to a suitable condition for other uses after its exploration and extraction activities. MMC incurred exploration and development costs of $60 million on the project MMC has a credit-adjusted risk free interest rate is 7%. It estimates the possibleash flows for restoring the land, three years after its extraction activities begin, as follows Probability 60% Cash Outflow S 10 million S 30 million 40% The asset retirement obligation (rounded) that should be recognized by MMC at the beginning of the extraction activities is: A) S18 million. C) S30 million. B) $8.2 million. D) $14.7 million. 16) Holiday Laboratories purchased a high-speed industrial centrifuge at a cost of $420,000. Shipping costs totaled $15,000. Foundation work to house the centrifuge cost $8,000. An additional water line had to be run to the equipment at a cost of $3,000. Labor and testing costs totaled $6,000. Materials used up in testing cost $3,000. The capitalized cost is: A) $455,000. D) $437,000 C) $446,000 B) S435.000