montana recordings purchased a new digital tape recorder on august 1, 20X3, for

Question

montana recordings purchased a new digital tape recorder on august 1, 20X3, for use in the business. the list price of the tape recorder was 28000. after considerable negotiations the manufacturer agreed to sell the recorder for 25000 with a 2% discount for cash payment on delivery. competing recording studios had recently paid 30000 for a similar recorder. sales taxes on the recorder amounted to 2600 delivery charges were 60 and labor charges ti install it amounted to 300. when the recorder was being carried through the parking lot a van belonging to a recording group under contract to montana recordings was accidentally scratched. the cost of repainting the van was 900 and was paid by the company. ordinary maintenance on the tape recorder during 20X3 amounted to 600. montana recordings tookadvantage of the cash discount offered for immediate cash payment on the tape recorder and paid all other expenditures in cash. in the space below determine the total cost of the purchase of the asset. label your work.

Explanation / Answer

cost of asset = $25000 - 0.02($25,000) + $2,600 +$60 + $300 = $27,460

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