Mad Hatter Enterprises purchased new equipment for $359,000, terms f.o.b. shipping point. Other costs connected with the purchase were as follows:
State sales tax
Freight costs
Insurance while in transit
Insurance after equipment placed in service
Installation costs
Insurance for the first year of operations
Testing
Required:
Determine the capitalized cost of the equipment.
Cost of equipment
$28,600
5,000
740
1,140
1,700
2,100
640