Your Company Buys a Computer System from IBM for $3

question 109

Multiple Choice

Your company buys a computer system from IBM for $3 million and pays IBM $200,000 to install the computer system.Your company should record:

• A)$3 million in equipment and $200,000 in expenses.
• B)$3.2 million in expenses.
• C)$2.8 million in equipment and the rest in expenses.
• D)$3.2 million in equipment.

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Definitions:

Universal Spirit

A concept referring to an all-encompassing, omnipresent spiritual presence or force believed to exist throughout the universe.

Hegel

A German philosopher of the late Enlightenment period, known for his dialectical method and his contributions to absolute idealism.

Adam Smith

An 18th-century Scottish economist and philosopher known as the father of classical economics, best known for his works "The Wealth of Nations," which outlines the basis for free market economics.

Invisible Hand

A term used by Adam Smith to describe the self-regulating nature of the marketplace, where individual self-interest can lead to beneficial social outcomes.