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fenix001 [56]
3 years ago
10

According to the historical cost principle, if an asset costs $50,000 when it was purchased, it would be reported at its _______

_ over the time the asset is held.
Business
1 answer:
Dafna11 [192]3 years ago
7 0

Answer:

Cost

Explanation:

The principle states that an asset would be recorded in the balance sheet at the value of its purchase price irrespective of the time it had been held; the principle encourages reliability in prices.

An example is when a company purchased a piece of land in 2000 for $3,000. After 10 years later, the company is still in business and on its balance sheet the value is recorded as $3,000 even though the current fair market value of the land is far greater than $3,000. This is a case of historical cost principle.

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Answer:

$132,000

Explanation:

The purchase price of the new machine is $109,000

Transportstion cost is $12,000

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Therefore the cost basis can be calculated as follows

= $109,000 + 12,000 $5,000+ $6000

= $132,000

Hence the cost basis is $132,000

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All of the above can prevent the spread of infections

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