Mad Hatter Enterprises purchased new equipment for $365,000, terms f.o.b. shipping point. Other costs connected with the purchase were as follows:
Required:
Determine the capitalized cost of the equipment.
$\begin{array}{lr}
\text { State sales tax } & 29,200 \
\text { Freight costs } & 5,600 \
\text { Insurance while in transit } & 800 \
\text { Insurance after equipment placed in service } & 1,200 \
\text { Installation costs } & 2,000 \
\text { Insurance for the first year of operations } & 2,400 \
\text { Testing } & 700
\end{array}$

Question

Mad Hatter Enterprises purchased new equipment for $365,000, terms f.o.b. shipping point. Other costs connected with the purchase were as follows:
Required:
Determine the capitalized cost of the equipment.
 $\begin{array}{lr}
\text { State sales tax } & 29,200 \
\text { Freight costs } & 5,600 \
\text { Insurance while in transit } & 800 \
\text { Insurance after equipment placed in service } & 1,200 \
\text { Installation costs } & 2,000 \
\text { Insurance for the first year of operations } & 2,400 \
\text { Testing } & 700
\end{array}$

Quizplus · Accepted Answer

The Answer of Mad Hatter Enterprises purchased new equipment for $365,000, terms f.o.b. shipping point. Other costs connected with the purchase were as follows:
Required:
Determine the capitalized cost of the equipment.
 $\begin{array}{lr}
\text { State sales tax } & 29,200 \
\text { Freight costs } & 5,600 \
\text { Insurance while in transit } & 800 \
\text { Insurance after equipment placed in service } & 1,200 \
\text { Installation costs } & 2,000 \
\text { Insurance for the first year of operations } & 2,400 \
\text { Testing } & 700
\end{array}$

Mad Hatter Enterprises Purchased New Equipment for $365,000, Terms F