What Amount Should Be Recorded as the Cost of a Machine

question 6

Multiple Choice

What amount should be recorded as the cost of a machine purchased December 31, 2010, which is to be financed by making 8 annual payments of $6,000 each beginning December 31, 2011? The applicable interest rate is 8%.

• A)$42,000
• B)$37,481
• C)$63,820
• D)$34,480

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Definitions:

Lateral Flexion

The movement of bending sideways at the waist or neck, a movement often assessed in physical examinations or in fitness.

Applying Cold and Heat

Therapeutic practices of using cold or heat applications to relieve pain, reduce inflammation, or aid in recovery of muscles and joints.

Aquatic Therapy

A therapeutic exercise program performed in water, aimed at rehabilitation, fitness, or relaxation purposes.

Dorsiflexion

The act of moving the upper part of the foot closer to the shin through the action of the ankle joint.