Reference no: EM132470800

Melinda Stoffers owns and operates ABC Print Co. During February, ABC incurred the following costs in acquiring two printing presses. One printing press was new, and the other was purchased from a business that recently filed for bankruptcy.

Question a. Indicate which costs incurred in acquiring the new printing press (1-6 below) should be debited to the asset account.

Item Debited to asset account

Point 1: Fee paid to factory representative for installation Yes or No

Point 2: Freight Yes or No

Point 3: Insurance while in transit Yes or No

Point 4: New parts to replace those damaged in unloading Yes or No

Point 5: Sales tax on purchase price Yes or No

Point 6: Special foundation Yes or No

Question b. Indicate which costs incurred in acquiring the used printing press (7-12 below) should be debited to the asset account.

Item Debited to asset account

Point 7: Fees paid to attorney to review purchase agreement Yes or No

Point 8: Freight Yes or No

Point 9: Installation Yes or No

Point 10: Repair of damage incurred in reconditioning the press Yes or No

Point 11: Replacement of worn-out parts Yes or No

Point 12: Vandalism repairs during installation Yes or No