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A company purchased a commercial dishwasher by paying cash of $4,600. The dishwasher's fair value on the date of the purchase was $4,980. The company incurred $420 in transportation costs, $350 installation fees, and paid a $250 fine for illegal parking while the dishwasher was being delivered. For what amount will the company record the dishwasher?A company purchased a commercial dishwasher by paying cash of $4,600. The dishwasher's fair value on the date of the purchase was $4,980. The company incurred $420 in transportation costs, $350 installation fees, and paid a $250 fine for illegal parking while the dishwasher was being delivered. For what amount will the company record the dishwasher?

Respuesta :

sadddamkashmiri801

Answer:

$5750

Explanation:

All the cost that are necessary to bring the machine in ready for use condition for the company must form part of the asset as per the International Accounting Standard IAS 16 Property, Plant and Equipment guidelines.

Cash paid                 $4980

Transportation cost  $420

Installation fees         $350  

Total cost                 $5750

The additional $250 cost that is paid as fine must not be included in the cost of the dishwasher machine as it was not necessary for the company to park the car in a inadmissible manner to make the dishwasher ready for use.

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