Corazon Company purchased an asset with a list price of $14,000. Corazon paid $500 of transportation in cost, $800 to train an employee to operate the equipment, and $200 to insure the asset against theft after it has been setup in the factory. The asset was purchased under terms 1/20/n30 and Corazon paid for the asset within the discount period. Based on this information, Corazon would capitalize the asset on its books at

$15160

Explanation:

The net terms or n/30 means that the payment fo an item purchased must be made within 30 days of purchase.

but 1/20/n30 means that if full payment of an asset or item purchased is made within the first 20 days of the 30 days an additional 1 % discount will be granted to the buyer.

since Corazon paid within the first 20 days he purchase price would be

= $14000 - (1% of $14000 )

= 14000 - 140

= $13860

the total capitalization of the asset by Corazon will be ( excluding the insurance)

= $13860 + $500 + $800 = $15160

a.

a manufacturer of printed circuit boards uses exponential smoothing with trend to forecast monthly demand of its product. at the end of december, the company wishes to forecast sales for january. the estimate of trend through november has been 200 additional boards sold per month. average sales have been around 1000 units per month. the demand for december was 1100 units. the company uses α = 0.20 and β = 0.10. make a forecast including trend for the month of january.