Apu has decided to start selling pizza at the Kwik-E-Mart. He recently purchased a pizza oven from Springfield Supply. The sticker price was $24,000 and the delivery charge (which the Kwik-E-Mart had to pay) was $400 and the insurance during transit cost $60. While the oven was being delivered, Apu's driver received a speeding ticket for $80 and the depreciation expense for the first year was $800.
As Apu's accountant, you are required to calculate the cost price for the pizza oven. Please be sure to show all your calculations.
To calculate the cost price for the pizza oven, we need to add up all the expenses incurred in acquiring and delivering the oven. Here are the calculations:
1. Sticker price: $24,000
2. Delivery charge: $400
3. Insurance during transit: $60
4. Speeding ticket: $80
5. Depreciation expense for the first year: $800
Now, let's add up all these expenses:
$24,000 + $400 + $60 + $80 + $800 = $25,340
Therefore, the cost price for the pizza oven is $25,340.