Prepare entries in the books of Thinker, Inc., to reflect the following. (Assume cash transactions.)
1. Purchased a milling machine to be used by the firm in its production process.
Invoice price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $35,000
Cash discount taken . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 700
Installation costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,600
Sales tax on machine. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,750
2. Performed normal periodic maintenance on the milling machine at a cost of $350.
3. Added to the milling machine a governor costing $500, which is expected to increase the machine’s useful life.