Hamlet College recently purchased new computing equipment for its library. The following information refers to the purchase and installation of this equipment.
1. The list price of the equipment was $285,000; however, Hamlet College qualified for an "education discount" of $25,000. It paid $50,000 cash for the equipment, and issued a three-month, 9 percent note payable for the remaining balance. The note, plus accrued interest charges of $4,500 was paid promptly the note's maturity date.
2. In addition to the amount described in 1, Hamlet paid sales taxes of $15,000 at the date of purchase.
3. Freight charges for delivery of the equipment totaled $1,000.
4. Installation costs related to the equipment amounted to $5,000.
5. During installation, one of the computer terminals was accidentally damaged by a library employee. It cost the college $500 to repair this damage.
6. As soon as the computers were installed, the college paid $4,000 to print admission brochures featuring the library's new, state-of-the-art computing facilities.
QUESTION:
a. In one sentence, make a general statement summarizing the nature of expenditures that qualify for including in the cost of plant assets such as computing equipment.