Question

Your company buys a computer system from IBM for $3 million and pays IBM $200,000 to install the computer system. The $3 million is on credit and your company pays $100,000 of interest on the loan in the current year. The acquisition cost of the computer system at the end of the current year will be

Answer 1

Answer:

$3.2 million

Explanation:

Calculation to determine what The acquisition cost of the computer system at the end of the current year will be

Using this formula

Acquisition cost=Purchase price+ Installation cost

Let plug in the morning

Acquisition cost= $3 million +$200,000

Acquisition cost=$3.2 million

Therefore The acquisition cost of the computer system at the end of the current year will be $3.2 million