What are the accounting implications of the issue above? Can...
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Accounting
What are the accounting implications of the issue above? Can you also clearly show any accounting adjustments required?
During 2018, Voodoo Limited decided to update and network the company's computer equipment. The details are as follows: List price of computer hardware Additional costs: 1,000,000 Shipping and handling Cabling and wiring One month testing prior to going live Four year on-site maintenance contract Own staff costs related to preparation of offices prior to installation 40,000 60,000 20,000 160,000 32,000 With respect to computer hardware, Voodoo Limited negotiated a 10 % trade discount on the list price and took advantage of a 5% early settlement discount for payment within 30 days
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