Question

On March 1, Bartholomew Company purchased a new stamping machine with a list price of $70,000. The company paid cash for the machine; therefore, it was allowed a 5% discount. Other costs associated with the machine were: transportation costs, $1,300; sales tax paid, $3,120; installation costs, $1,000; routine maintenance during the first month of operation, $1,200. What is the cost of the machine

Answer 1

$73,120

Step-by-step explanation:

Bartholomew company purchased a new stamping machine with a list price of $70,000

They were given a discount of 5%

Other costs that are associated with the machine include

Transportation costs= $1,300

Sales tax= $3,120

Installation costs= $1,000

Routine maintenance during the first month= $1,200

Then, the cost of the machine can be calculated as follows

(70,000-5/100×70,000) + $1,300+$3,120+$1,000+$1,200

$66,500+$1,300+$3,120+$1,000+$1,200

= $73,120

Hence the cost of the machine is $73,120