Hunt Company purchased factory equipment with an invoice price of $90000. Other costs incurred were freight costs $1100; installation wiring and foundation $2200; material and labor costs in testing equipment $700; oil lubricants and supplies to be used with equipment $500; fire insurance policy covering equipment $1400. The equipment is estimated to have a $5000 salvage value at the end of its 8-year useful service life.
Instructions
(a) Compute the acquisition cost of the equipment. Clearly identify each element of cost.
(b) If the double-declining-balance method of depreciation was used the constant percentage applied to a declining book value would be __________.

Question

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The Answer of Hunt Company purchased factory equipment with an invoice price of $90000. Other costs incurred were freight costs $1100; installation wiring and foundation $2200; material and labor costs in testing equipment $700; oil lubricants and supplies to be used with equipment $500; fire insurance policy covering equipment $1400. The equipment is estimated to have a $5000 salvage value at the end of its 8-year useful service life.
Instructions
(a) Compute the acquisition cost of the equipment. Clearly identify each element of cost.
(b) If the double-declining-balance method of depreciation was used the constant percentage applied to a declining book value would be __________.

Hunt Company Purchased Factory Equipment with an Invoice Price of $90000