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Problem1. The University took delivery of the microcomputer and printer on 1 July 2008, the beginning of its financial year. The list price of equipments was Rs 99,980 but the University was capable to negotiate a price of Rs 80,000 with supplier. But, the supplier charged an additional Rs 6,800 to install and test equipments. The supplier offered a 5% discount if the University paid for the equipments and additional installation costs in seven days. The University was capable to take advantage of this additional discount. The installation of special electrical wiring for the computer cost Rs 2,200. After initial testing certain modifications costing Rs 3,980 proved essential. Staffs were sent on special training courses to operate the microcomputer and this cost Rs 19,800. The University insured the machine against fire and theft at cost of Rs 980 per annum. A maintenance agreement was entered in with Clarke Insurance Ltd. Under this agreement Clarke Insurance Ltd promised to provide 24 hour breakdown cover for 1 year. The cost of the maintenance agreement was Rs 7,000.
Required:

problem1. Evaluate the acquisition cost of the microcomputer to University.

Financial Accounting, Accounting

  • Category:- Financial Accounting
  • Reference No.:- M94356

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