On January 1, 2021, Fergus Company acquired equipment on credit. The terms were $8,000 cash down payment plus payments of $6,000 on January 1 for each of the next five years. The implicit interest rate was 6%. The equipments list price was $36,000. Additional costs of $1,500 were incurred to install the equipment.

Instructions

Determine the value at which Fergus should report the acquired asset. Show your calculations. For any measurement involving present value concepts, provide your calculations.