Reference no: EM133186779
Question - Olivia Company was installing new equipment at its production facility and incurred the following costs:
Cash price of the equipment, VAT inclusive of 12% 2,800,000
Initial delivery and handling cost 200,000
Cost of site preparation 600,000
Consultant used for advance on the acquisition of equipment 700,000
Interest charges paid to supplier for deferred credit 200,000
Estimated dismantling cost that may be incurred upon retirement 300,000
Operating losses before commercial production 400,000
Required - What is the total cost of the equipment?
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