Question
The Blue Moon Motel has purchased a new computer for its own use. Using the following information, determine the proper amount to be capitalized in
The Blue Moon Motel has purchased a new computer for its own use.
Using the following information, determine the proper amount to be capitalized in the asset account Eqipment.
The invoice includes the price of the computer, the sales tax, and maintenance.
Invoice price of eqipment $10,000
Sales tax on purchase (4% as shown on invoice) 400
Terms of Sale: 2/10, n/30
(Assume the invoice will be paid within the discount period)
Freight in paid 300
Speeding ticket given to our truck driver while operating equipment 25
Installation costs 150
Maintenance contract- 2 years 2,000
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