Lowery, Inc., purchased new plant equipment on January 1, 1996. The company paid $920,000 for the equipment, $62,000 for transportation of the equipment, and $10,000 for insurance on the equipment while it was being transported. The company also estimates that over the equip¬ ment’s useful life it will require additional power, which will cause utility costs to increase $90,000. The equipment has an estimated salvage value of $50,000. -SO REQUIRED: a.What amount should the company capitalize for this equipment on January 1, 1996? "T>. What is the depreciation base of this equipment? ”

c. What amount will be depreciated over the life of this equipment?