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What is the total amount to be capitalized as cost

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Problem - Calamansi Company made the following acquisitions during 2021: - Purchased a new machine on a deferred payment basis. A down payment of P500,000 was made and 4 monthly installments of P1,000,000 are to be made at the end of each month. The cash price of the machine was P3,900,000. The entity incurred and paid installation cost amounting to P150,000.

Acquired a tract of land in exchange for 20,000 shares of Cherries Company with P200 par value on the date of acquisition. The last property tax bill indicated assessed value of P2,000,000 and original cost of P1,500,000 for the land. What is the total amount to be capitalized as cost of the land and machine?

Reference no: EM132955029

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