Preparing Journal entry purchase and costs
I am so stuck! I have spent hours trying to find an
Example in my book or on the internet.
Here is the question.
I have to prepare a journal entry to record the
Machine's purchase and the costs to ready and install
It. Cash is paid for all costs incurred.
Calhoon purchases a used machine for $167.000 cash on
January 2 and readies it for use the next day at a
$3,420 cost. On January 3, it is installed on a
Required operating platform costing $1080, and it is
Readied for operation.
I know the total cost will be $171,500
Do I just put one Cash with this total for the credit?
How do I do the journal for the machine, readying and
Installing on a operating platform? Is it all one
Journal entry?
When it posts to a ledger it will all go to machine expense,which is why I think I only need one journal entry for all three purchases.
I know we are suppose to try for an answer so here is what I think I should do.
Machine expense debit $167,000
Machine expense Ready machine for use debit $3420
Machine expense install on platform debit $1,080
Cash credit $171,500
To record buying machine and getting it ready for use
Thank you in advance for your help!
Connie