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Rasek [7]
3 years ago
14

Holiday Laboratories purchased a high-speed industrial centrifuge at a cost of $440,000. Shipping costs totaled $30,000. Foundat

ion work to house the centrifuge cost $8,600. An additional water line had to be run to the equipment at a cost of $3,000. Labor and testing costs totaled $5,300. Materials used up in testing cost $2,600. The capitalized cost is:__________.
a. $489,900.
b. $470,000.
c. $481,600.
d. $489,500.
Business
1 answer:
Yakvenalex [24]3 years ago
7 0

Answer:

d. $489,500

Explanation:

The capitalized cost will include all the costs incurred by Holiday laboratories to readily make the asset for use.

Therefore,

Capitalized cost = High speed industrial centrifuge + Shipping cost + Foundation cost + Equipment cost + Labor and testing cost + Material cost

= $440,000 + $30,000 + $8,600 + $3,000 + $5,300 + $2,600

= $489,500

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