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

answer; is usually (less than) the socially optimal level of consumption;