Maximum Renovation Company decided to purchase a new carpet cutting machine for its shop in Los Angeles.
Question:
Sales tax . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,400
Delivery costs (FOB shipping point) . . . . . . . . . . . . . . . . . . . . . . . . . . 1,200
Assembly cost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 900
Painting of machine to match the décor . . . . . . . . . . . . . . . . . . . . . . . . 500
1. What is the cost of the machine to Maximum?
2. What is the amount of the first full year’s depreciation if Maximum uses the straight-line method?
Salvage Value
Salvage value is the estimated book value of an asset after depreciation is complete, based on what a company expects to receive in exchange for the asset at the end of its useful life. As such, an asset’s estimated salvage value is an important...
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1 Purchase price 32000 Sales tax 1400 ...View the full answer
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Asim farooq
I have done MS finance and expertise in the field of Accounting, finance, cost accounting, security analysis and portfolio management and management, MS office is at my fingertips, I want my client to take advantage of my practical knowledge. I have been mentoring my client on a freelancer website from last two years, Currently I am working in Telecom company as a financial analyst and before that working as an accountant with Pepsi for one year. I also join a nonprofit organization as a finance assistant to my job duties are making payment to client after tax calculation, I have started my professional career from teaching I was teaching to a master's level student for two years in the evening.
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Related Book For 
Accounting concepts and applications
ISBN: 978-0538745482
11th Edition
Authors: Albrecht Stice, Stice Swain
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