On March 1, Bunker Hill Company purchased a new stamping machine with a list price of $68,000. The company paid cash for the machine; therefore, it was allowed a 5% discount. Other costs associated with the machine were: transportation costs, $1,100; sales tax paid, $2,720; installation costs, $900; routine maintenance during the first month of operation, $1,000. The cost recorded for the machine was:
A)$68,420.
B)$64,600.
C)$69,320.
D)$70,320.

Question

Quizplus · Accepted Answer

$68,000 - ($68,000 x 5%) + $1,100 transportation + $2,720 sales tax + $900 installation = $69,320. The routine maintenance is not included in the cost of the machine, but is instead expensed during the first month.

On March 1, Bunker Hill Company Purchased a New Stamping