On September 10, 2010, Jenks Co. incurred the following costs for one of its pri

Question

On September 10, 2010, Jenks Co. incurred the following costs for one of its printing presses:

Purchase of attachment $55,000
Installation of attachment 5,000
Replacement parts for renovation of press 18,000
Labor and overhead in connection with renovation of press 7,000

Neither the attachment nor the renovation increased the estimated useful life of the press. However, the renovation resulted in significantly increased productivity. What amount of the costs should be capitalized?
a. $0.
b. $67,000.
c. $78,000.
d. $85,000.

Explanation / Answer

The renovation resulted in significantly increased productivity, and attachment is an addition to the present machine. The amount of the costs should be capitalized: d. $85,000.

Related Questions

Navigate

• Browse (All)
• Browse O
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.