Mist City Car Wash purchased a new brushless car-washing machine for one of its bays. The machine
Question:
Plumbing................ $2,700
Electrical ............... 1,640
Water (for testing the machine) ...... 35
Soap (for testing the machine) ...... 18
During the testing process, one of the motors became defective when soap and water entered the motor because its cover had not been installed properly by Mist City’s employees. The motor was replaced at a cost of $450.
Required:
1. Compute the cost of the car-washing machine.
2. Explain why any costs were excluded from the cost of the machine.
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Related Book For
Cornerstones of Financial and Managerial Accounting
ISBN: 978-1111879044
2nd edition
Authors: Rich, Jeff Jones, Dan Heitger, Maryanne Mowen, Don Hansen
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