Blue Horizon has acquired equipment and incurred these expenses in doing so.
$
Gross invoice price,net of GST,subject to terms of 2/10,n/30)14 500
Transportation costs to get equipment to factory 1 200
Speeding ticket incurred by company driver while
Delivering equipment to the factory 120
Cost to repair wall damaged during installation 500
Special permit to allow wide load on freeway 300
The equipment should be recorded in Blue Horizon's records at:

Question

Quizplus · Accepted Answer

The equipment should be recorded in Blue Horizon's records at its gross invoice price, which is $14,500. However, additional costs incurred to get the equipment to the factory, including transportation costs ($1,200) and special permit costs ($300), should also be included in the cost of the asset.

The speeding ticket incurred by the driver and the cost to repair the wall damaged during installation are not directly related to the cost of the asset and should be expensed separately.

Therefore, the total cost of the asset should be $14,500 + $1,200 + $300 = $16,000.

Option C is the closest to this total cost.

Blue Horizon Has Acquired Equipment and Incurred These Expenses in Doing