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18 May, 15:30

Corrieten Company purchased equipment and incurred these costs:

Cash price $24,000

Sales Tax 1,200

Installation and testing 400

Insurance during transit 200

Total costs $25,800

What amount should be recorded as the cost of the equipment?

A. $24,000

B. $25,200

C. $25,400

D. $25,800

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Answers (1)
  1. 18 May, 19:21
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    Answer: D. $25,800

    Explanation:

    Given the following:

    Cash price - $24,000

    Sales Tax - $1,200

    Installation and testing - $400

    Insurance during transit - $200

    Total price = cash price + sales tax + installation and testing + insurance during transit

    Total price = $24,000 + $1,200 + $400 + $200

    Toral price = $25,800

    Total cost of equipment that should be recorded is $25,800
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