Application of cost principle in finding acquisition cost

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The following expenditures relating to plant assets were made by Spaulding Company during the first 2 months of 2011.

Paid $5,000 of accrued taxes at time plant site was acquired.

Paid $200 insurance to cover possible accident loss on new factory machinery while the machinery was in transit.

Paid $850 sales taxes on new delivery truck.

Paid $17,500 for parking lots and driveways on new plant site.

Paid $250 to have company name and advertising slogan painted on new delivery truck.

Paid $8,000 for installation of new factory machinery.

Paid $900 for one-year accident insurance policy on new delivery truck.

Paid $75 motor vehicle license fee on the new truck.

Explain the application of the cost principle in determining the acquisition cost of plant assets.

Reference no: EM13140158

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