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Problem 1: On September 7, 2020, Paseo Company incurred the following costs for one of its printing presses: Purchase of stapling attachment: P900,000 Installation of attachment: P200,000 Replacement parts for renovation of press: P600,000 Labor and overhead in connection with renovation of press: P280,000. Neither the attachment nor the renovation increased the estimated useful life of the press. However, the renovation resulted in significantly increased productivity. What amount of the costs should be capitalized?
a. P1,980,000b. P1,100,000c. P900,000d. P880,000
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