3. efg company purchased a used delivery truck for its business. it paid the seller $25,000 and agreed to…

3. efg company purchased a used delivery truck for its business. it paid the seller $25,000 and agreed to pay an additional $22,000 one year later. the $22,000 included one years interest of $2,000. what amount should efg company record in its general ledger account delivery trucks? select... $47,000 $25,000 $27,000 $45,000

3. efg company purchased a used delivery truck for its business. it paid the seller $25,000 and agreed to pay an additional $22,000 one year later. the $22,000 included one years interest of $2,000. what amount should efg company record in its general ledger account delivery trucks? select... $47,000 $25,000 $27,000 $45,000

Answer

Explanation:

Step1: Identify relevant costs

The cost of an asset includes all costs necessary to get it in place and ready for use. Interest is not part of the asset - cost.

Step2: Calculate asset cost

The initial payment is $25,000 and the non - interest part of the future payment is $22,000 - $2,000=$20,000. The cost of the delivery truck is $25,000 + 20,000=$45,000.

Answer:

$45,000