Testbank Problem 139
During 2020, Debra Building Company constructed various assets
at a total cost of $12,600,000. The weighted average accumulated
expenditures on assets qualifying for capitalization of interest
during 2020 were $8,729,000. The company had the following debt
outstanding at December 31, 2020:
1. | 10%, 5-year note to finance construction of various assets, dated January 1, 2020, with interest payable annually on January 1 | $5,313,000 | ||
2. | 12%, ten-year bonds issued at par on December 31, 2014, with interest payable annually on December 31 | 5,953,000 | ||
3. | 9%, 3-year note payable, dated January 1, 2019, with interest payable annually on January 1 | 2,976,500 |
Compute the amounts of each of the following.
1. | Avoidable interest | $
|
|
2. | Total interest to be capitalized during 2020 | $
|
Testbank Problem 139 During 2020, Debra Building Company constructed various assets at a total cost of...
During 2017, Barden Building Company constructed various assets at a total cost of $12,600,000. The weighted average accumulated expenditures on assets qualifying for capitalization of interest during 2017 were $8,742,000. The company had the following debt outstanding at December 31, 2017: 1096, 5-year note to finance construction of various assets, dated January 1, 2017, with interest payable annually on January 1 1. $5,262,000 6,123,000 3,061,500 12%, ten-year bonds issued at par on December 31, 2011, with interest payable annually on...
During 2017, Barden Building Company constructed various assets at a total cost of $12,600,000. The weighted average accumulated expenditures on assets qualifying for capitalization of interest during 2017 were $8,742,000. The company had the following debt outstanding at December 31, 2017: 1096, 5-year note to finance construction of various assets, dated January 1, 2017, with interest $5,262,000 6,123,000 3,061,500 payable annually on January 1 12%, ten-year bonds issued at par on December 31, 2011, with interest payable annually on December...
Teslüdrik Problemi 139 x Your answer is incorrect. Try again. During 2020, Maria Building Company constructed various assets at a total cost of $12,600,000. The weighted average accumulated expenditures on assets qualifying for capitalization of interest during 2020 were $8,347,000. The company had the following debt outstanding at December 31, 2020: 1. 10%, 5-year note to finance construction of various assets, dated January 1, 2020, with interest payable annually on January 1 2. 12%, ten-year bonds issued at par on...
Please show work for this problem.
4. (7 points) During 2014, Barden Building Company constructed various assets at a total cost of $12,600,000. The weighted average accumulated expenditures on assets qualifying for capitalization of interest during 2014 were $8,400,000. The company had the following debt outstanding at December 31, 2014: 1. 10%, 5-year note to finance construction of various assets, dated January 1, 2014, with interest payable annually on January 1 $5,400,000 2. 12%, ten-year bonds issued at par on...
Testbank Problem 140
Early in 2020, Dobbs Corporation engaged Kiner, Inc. to design
and construct a complete modernization of Dobbs's manufacturing
facility. Construction was begun on June 1, 2020 and was completed
on December 31, 2020. Dobbs made the following payments to Kiner,
Inc. during 2020:
Date
Payment
June 1, 2020
$2,200,000
August 31, 2020
3,300,000
December 31, 2020
2,750,000
In order to help finance the construction, Dobbs issued the
following during 2020:
1.
$1,870,000 of 10-year, 9% bonds payable,...
Testbank Problem 140 Early in 2020, Dobbs Corporation engaged Kiner, Inc. to design and construct a complete modernization of Dobbs's manufacturing facility. Construction was begun on June 1, 2020 and was completed on December 31, 2020. Dobbs made the following payments to Kiner, Inc. during 2020: Payment Date $1,600,000 June 1, 2020 2,400,000 August 31, 2020 December 31, 2020 2,000,000 In order to help finance the construction, Dobbs issued the following during 2020 1. $1,360,000 of 10-year, 9% bonds payable,...
Early in 2020, Dobbs Corporation engaged Kiner, Inc. to design
and construct a complete modernization of Dobbs's manufacturing
facility. Construction was begun on June 1, 2020 and was completed
on December 31, 2020. Dobbs made the following payments to Kiner,
Inc. during 2020:
Date
Payment
June 1, 2020
$1,680,000
August 31, 2020
2,520,000
December 31, 2020
2,100,000
In order to help finance the construction, Dobbs issued the
following during 2020:
1.
$1,428,000 of 10-year, 9% bonds payable, issued at par...
Early in 2020, Qatar Corporation engaged Emirate Ltd. to design and construct a complete modernization of Qatar’s manufacturing facility. Construction began on June 1, 2020, and was completed on December 31, 2020. Qatar made the following payments to Emirate Ltd. during 2020: Date Payment June 1, 2020$ 3,300,000 August 31, 20204,800,000 December 31, 20204,000,000 In order to help finance the construction, Qatar issued the following during 2020: 1.$ 2,000,000, ten-year, 9% bonds payable, issued at par on May 31, 2020,...
Early in 2020, Qatar Corporation engaged Emirate Ltd. to design and construct a complete modernization of Qatar’s manufacturing facility. Construction began on June 1, 2020, and was completed on December 31, 2020. Qatar made the following payments to Emirate Ltd. during 2020: Date Payment June 1, 2020$ 3,300,000 August 31, 20204,800,000 December 31, 20204,000,000 In order to help finance the construction, Qatar issued the following during 2020: 1.$ 2,000,000, ten-year, 9% bonds payable, issued at par on May 31, 2020,...
During 2020, Waterway Industries incurred weighted-average accumulated expenditures of $1620000 during construction of assets that qualified for capitalization of interest. The only debt outstanding during 2020 was a $2030000, 11%, 5-year note payable dated January 1, 2020. What is the amount of interest that should be capitalized by Waterway during 2020?