| Louisiana Logging Co. purchased an electronic saw to cut various types and sizes of logs. The saw had a list price of $118,580. The seller agreed to allow a 4.25 percent discount because Louisiana paid cash. Delivery terms were FOB shipping point. Freight cost amounted to $2,810. Louisiana had to hire an individual to operate the saw. Louisiana had to build a special platform to mount the saw. The cost of the platform was $1,240. The saw operator was paid an annual salary of $44,910. The cost of the companys theft insurance policy increased by $1,610 per year as a result of acquiring the saw. The saw had a five-year useful life and an expected salvage value of $10,400. |
