Business, 02.12.2021 06:10 nickydeuce3

On January 1st, 2002, the Grind Company purchased a machine for its production process. The cash price of the machine was $35,000. Related expenditures included shipping costs, $175; insurance during shipping, $75; installation and testing costs; $50; and $90 of oil and lubricant costs to be used on the machinery during its first year of operations. Grind estimates that the useful life of the machine is four years with a residual value of $5,000. In terms of activity, it estimates the useful life of the machine to be 25,000 units. Actual usage is as follows: for 2002, 6,500 units; for 2003, 7,500 units; for 2004, 6,000 units; and for 2005, 5,000 units.

1. Determine the capital cost of the machine on January 1, 2002.

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On January 1st, 2002, the Grind Company purchased a machine for its production process. The cash pri...