The seller agreed to allow a 5 percent discount because Oregon paid cash. Delivery terms were FOB shipping point. Freight cost amounted to $3,200. Oregon had to hire an individual to operate the saw. Oregon had to build a special platform to mount the saw. The cost of the platform was $2,500. The saw operator was paid an annual salary of $50,000. The cost of the company’s theft insurance policy increased by $1,800 per year as a result of acquiring of the saw. The saw had a five-year useful life and an expected salvage value of $25,000. Required a. Determine the amount to be capitalized in an asset account for the purchase of the saw. b. Record the purchase in general journal format. View Solution:
Oregon Logging Co purchased an electronic saw to cut various