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Question - Greene Corporation purchases equipment on April 1, 2016, for $50,000 but also pays the following costs:$900 for freight charges; $150 for insurance while the equipment was in transit; $1,900 for a one-year insurance policy; $1,500 to train employees to use the new equipment; and $3,400 for testing and installation. The equipment was ready for use on May 1, but the company did not start using it until June 1. Greene estimates that the equipment will be used for 4 years, during which time they estimate that it will be used for 8,400 machine hours. At the end of the 4 years it is estimated that it will have a residual value of $18,450. The company has a December 31 year end.
Required: Calculate the cost of the equipment and provide the entries necessary for all the costs that have been incurred.
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