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Jamison Company purchased the assets of Booker Company at an auction for $1,400,000.An independent appraisal of the fair value of the assets is listed below:
-On August 1, 2010, Mendez Corporation purchased a new machine on a deferred payment basis.A down payment of $2,000 was made and 4 annual installments of $6,000 each are to be made beginning on September 1, 2010.The cash equivalent price of the machine was $23,000.Due to an employee strike, Mendez could not install the machine immediately, and thus incurred $300 of storage costs.Costs of installation (excluding the storage costs) amounted to $800.The amount to be capitalized as the cost of the machine is

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Use the following information to answer questions 
Jamison Company purchased the assets of Booker Company at an auction for $1,400,000.An independent appraisal of the fair value of the assets is listed below: 
-On August 1, 2010, Mendez Corporation purchased a new machine on a deferred payment basis.A down payment of $2,000 was made and 4 annual installments of $6,000 each are to be made beginning on September 1, 2010.The cash equivalent price of the machine was $23,000.Due to an employee strike, Mendez could not install the machine immediately, and thus incurred $300 of storage costs.Costs of installation (excluding the storage costs) amounted to $800.The amount to be capitalized as the cost of the machine is

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The cost to be capitalized includes the cash equivalent price of the machine ($23,000), the down payment ($2,000), the four annual installments of $6,000 each ($24,000), the storage costs ($300), and the installation costs ($800). Therefore, the total cost to be capitalized is $23,000 + $2,000 + $24,000 + $300 + $800 = $23,800.

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