2 Teal Co. recently installed some new computer equipment. To prepare for the installation, Teal had some electrical work done in whatwas to become the server room, costing $19,900. The invoice price of the server equipment was $194,000. Three printers were alsopurchased at a cost of $1,800 each. The software for the system was an additional $43,400. The server equipment was believed tohave a useful life of eight years, but due to the heavy anticipated usage, the printers were expected to have only a four-year useful life.The software to run the system was estimated to require a complete upgrade in five years to avoid obsolescence. Additionally, it cost$11,700 for delivery. All of the above costs were subject to a 6% non-refundable provincial sales tax. During the installation, a trainingcourse was conducted for the staff that would be using the new equipment, at a cost of $9,870. Assume that Teal follows IFRS, and thatany allocation of common costs is done to the nearest 1% (e.g., 80%, 6%, 14%).(b) Assume that Teal decides to capitalize the following components of the computer system: server equipment, printers, and software.Calculate the amount to be capitalized for each of these asset groups. (Round percentage to O decimal places, e.g. 52% and final answers toO decimal places, e.g. 5,275.)Server equipmentPrintersSoftware$$$Cost

Asset is something which is owned by the company.Computer equipment is a fixed or non-current asset…

(b) Assume that Teal decides to capitalize the following components of the computer system: server equipment, printers, and software. Calculate the amount to be capitalized for each of these asset groups. (Round percentage to O decimal places, e.g. 52% and final answers to O decimal places, e.g. 5,275.) Server equipment Printers Software +A LA +A $ Cost

(b) Assume that Teal decides to capitalize the following components of the computer system: server equipment, printers, and software. Calculate the amount to be capitalized for each of these asset groups. (Round percentage to O decimal places, e.g. 52% and final answers to O decimal places, e.g. 5,275.) Server equipment Printers Software +A LA +A $ Cost

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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