Major Company purchased equipment to be used in its distribution center.All of the following should be included in the cost of the equipment EXCEPT for:

Question

Quizplus · Accepted Answer

Insurance costs after the equipment is up and running should not be included in the cost of the equipment. The cost of the equipment should include all costs directly related to getting the equipment ready for use, such as insurance while in transit, wages of workers who test the equipment before it is placed in service, and employee training costs before the equipment is placed in service. Once the equipment is up and running, any costs related to insurance should be considered a separate expense.

Major Company Purchased Equipment to Be Used in Its Distribution