Find what amount of the costs should be capitalized

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Reference no: EM132758091

On October 12, 2020, Howard Co. incurred the following costs for one of its printing presses:

Purchase of attachment £55,000

Installation of attachment £5,000

Replacement parts for renovation of press £18,000

Labor and overhead in connection with renovation of press £7,000

Neither the attachment nor the renovation increased the estimated useful life of the press. However, the renovation resulted in significantly increased productivity.

Problem 1: What amount of the costs should be capitalized?

Option 1: £85,000.

Option 2: £67,000.

Option 3: £78,000.

Option 4: £0.

Reference no: EM132758091

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