What is the acquisition cost of the equipment

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Problem

SAXOPHONE COMPANY acquires a new manufacturing equipment on January 1, 2023, on installment basis. The deferred payment contract provides for a down payment of P300,000 and an 8-year note for P3,104,160. The note is to be paid in 8 equal annual installment payments of P388,020, including 10% interest. The payments are to be made on December 31 of each year, beginning December 31, 2023. The equipment has a cash price equivalent of P2,370,000. Saxophone's financial year-end is December 31. Get the instant assignment help.

What is the acquisition cost of the equipment?

Reference no: EM133901494

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