Queue,Incorporated Incurred the Following Expenditures for the Purchase and Use

question 22

Essay

Queue,Incorporated incurred the following expenditures for the purchase and use of a machine,which was placed into service on January 1,2011:
Required:
1.Determine the total costs that should be capitalized into the machine account.What is the total? Explain how you decided which costs to capitalize.
2.Determine the total operating expenses associated with using the machine for the year ended December 31,2011.Assume the machine has an estimated 5-year useful life and an $8,000 salvage value.Explain how you decided which costs to expense.

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Definitions:

Bank Reconciliation

The process of matching and comparing figures from accounting records against those shown on a bank statement to ensure consistency.

Depositor's Balance

The current amount of money held in a depositor's account at a financial institution, reflecting all transactions.

Suspected of Fraud

Being under suspicion for intentional deception to secure unfair or unlawful gain.

NSF

An abbreviation for "Non-Sufficient Funds," indicating that a bank account does not have enough money to cover a check or withdrawal.