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Exercise 8-1 Cost of plant assets L. P1 Kruz Co. purchases a machine for $10,400, terms 1/10, n/60, FOB shipping point.

Exercise 8-1 Cost of plant assets L.O. P1 Kruz Co. purchases a machine for $10,400, terms 1/10, n/60, FOB shipping point. The seller prepaid the $235 freight charges, adding the amount to the invoice and bringing its total to $10,635. The machine requires special steel mounting and power connections costing $719. Another $339 is paid to assemble the machine and get it into operation. In moving the machine to its steel mounting, $250 in damages occurred. Materials costing $40 are used in adjusting the machine to produce a satisfactory product. The adjustments are normal for this machine and are not the result of the damages.

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