Property, Plant and Equipment

1. Newcastle Ltd uses many kinds of machines in its operations. It constructs some of these machines itself and acquires others from

the manufacturers. The following information relates to machine A that it has recorded during 2014.

Cashpaidforequipment,includingVATof9,60089,600

Cost of transporting machine

-

insuranceandtransport3,000

Laborcostofinstallationbyexpertfitter5,000

Laborcostoftestingequipment4,000

Insurancecostfor20141,500

Costsoftrainingforpersonnelwhowillusethemachine2,500

Costsofsafetyrailsandplatformssurroundingmachine6,000

Costsofwaterdevicestokeepmachinecool8,000

Costsofadjustmentstomachinetomakeitoperatemoreefficiently7,500

Determine the amount at which machine A should be recorded in the records of Newcastle Ltd?

A.

116,000

B.

121,500

C.

105,500

D.

113,500