Financial Accounting

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Capital Expenditures vs Expenses:Capitalized Amount for Equipment


On April 1, 2015, Golden Wheat Company purchased a piece of equipment for \$150,000 including shipping.

Another \$9,000 in sales tax was paid relative to the equipment in accordance with state law. As required by the equipment manufacturer, Golden Wheat paid \$12,000 to update the electrical wiring in the company’s manufacturing facility to accommodate the new equipment. Between May 1, 2015 and December 31, 2015, Golden Wheat paid \$6,500 to maintain the equipment so that it could be operated as efficiently as possible.

What is the capitalized cost of the equipment purchased that Golden Wheat Company reported on its Balance Sheet at December 31, 2015?