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2) A company purchased a piece of equipment by paying $5,000cash. Shipping cost of $400 to get the equipment to its factory was also incurred.

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2) A company purchased a piece of equipment by paying $5,000cash. Shipping cost of $400 to get the equipment to its factory was also incurred. The fair value of this equipment is $7,000. For what amount should the company report the equipment? A) $5,000 B) $5,400 C) $7,000 D) $7,400

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