Question $1(5)$

The components of the cost of a major item of equipment are given below.

P

Purchase price $780,000$

Import duties $117,000$

Site preparation $30,000$

Installation $28,000$

General overheads $50,000$

$1,005,000$

Calculate the amount should be recognised as the cost of the asset, according to IAS $16$ Property, Plant and Equipment?