Yocum Company purchased equipment on January 1 at a list price of $120,000, with credit terms 2/10, n/30.Payment was made within the discount period and Yocum was given a $2,400 cash discount.Yocum paid $6,000 in sales tax on the equipment and installation charges of $1,760.Prior to installation, Yocum paid $4,000 to pour a concrete slab on which to place the equipment.What is the total cost of the new equipment?

Question

Quizplus · Accepted Answer

The total cost of the equipment includes the purchase price after the discount, sales tax, installation charges, and the cost of the concrete slab. The discounted purchase price is $120,000 - $2,400 = $117,600. Adding the sales tax ($6,000), installation charges ($1,760), and concrete slab cost ($4,000) gives a total cost of $129,360.

Yocum Company Purchased Equipment on January 1 at a List