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5 June, 23:42

A used machine with a purchase price of $77,000, requiring an overhaul costing $8,000, installation costs of $5,000, and special acquisition fees of $3,000, would have a cost basis of

a. $82,000

b. $90,000

c. $8S, 000

d. $93,000

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Answers (1)
  1. 6 June, 03:03
    0
    Cost basis will be equal to $93000

    So option (d) will be correct answer

    Explanation:

    We have given purchased price of machine = $77000

    overhaul costing is given $8000

    Installation cost = $5000

    And special acquisition fees is given $3000

    We have to fond the cost basis

    Cost basis will be sum of all purchased price, overhaul cost, installation cost and special acquisition fees

    So cost basis will be equal to = $77000+$8000+$5000+$3000 = $93000

    So cost basis will be equal to $93000

    So option (d) will be correct answer
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