1) a.Calculation of Capitalized Interest for 2021(Amounts in $):
Particulars | Month wise Expenditure | Amount |
January 1,2021 | 1,420,000*(12/12) | 1,420,000 |
March 1,2021 | 1,140,000*(10/12) | 950,000 |
June 30,2021 | 1,340,000*(6/12) | 670,000 |
October 1,2021 | 1,140,000*(3/12) | 285,000 |
Accumulated Expenditure before interest (A) | 5,040,000 | |
Average Accumulated Expenditure (B) | 3,325,000 | |
Interest Capitalized (A*12%) (C) | 399,000 |
b.Calculation of Capitalized Interest for 2022 (Amounts in $):
Particulars | Month wise Expenditure | Amount |
January 1,2022 (5,040,000 +399,000) | 5,439,000*(9/9) | 5,439,000 |
January 31,2022 | 351,000*(8/9) | 312,000 |
April 30,2022 | 684,000*(5/9) | 380,000 |
August 31,2022 | 981,000*(1/9) | 109,000 |
Accumulated Expenditure before interest | 7,455,000 | |
Average Accumulated Expenditure (A) | 6,240,000 | |
Weighted average rate for all other debt | 600,000*8% = 480,000 | |
900,000*10% = 900,000 | ||
Weighted average rate | [(480,000+900,000)/(6,000,000+9,000,000)]*100 | 9.2% |
Interest Capitalized 2012: | ||
For loan amount | 3,900,000*12% | 468,000 |
Remaining amount of Expenditure (6,240,000 - 3,900,000) | 2,340,000*9.2% | 215,280 |
Total Interest Capitalized 2012 | 683,280 |
Note: 9 month period is taken to calculate the average accumulated expenditure because the construction stands completed on September 30,2022.
2. Calculation of total Cost of Building(Amounts in $):
Expenditure in 2021 | 5,040,000 |
Interest Capitalized in 2021 | 399,000 |
Expenditure in 2022 (351,000+684,000+981,000) | 2,016,000 |
Interest Capitalized in 2022 | 683,280 |
Total Cost of Building | 8,138,280 |
3. Calculation of Interest Expense in 2021 and 2022(Amounts in $):
2021:
Total Interest Incurred | ||
3,900,000*12% | 468,000 | |
6,000,000*8% | 480,000 | |
9,000,000*10% | 900,000 | |
total Interest Incurred (A) | 1,848,000 | |
Interest Capitalized in 2021 (B) | 399,000 | |
Interest Expenses for 2021 (A-B) | 1,449,000 |
2022:
Total Interest Incurred | ||
3,900,000*12% | 468,000 | |
6,000,000*8% | 480,000 | |
9,000,000*10% | 900,000 | |
total Interest Incurred (A) | 1,848,000 | |
Interest Capitalized in 2022(B) | 683,280 | |
Interest Expenses for 2022(A-B) | 1,164,720 |
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used...
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 March 1, 2021 June 30, 2021 October 1, 2021 January 31, 2022 April 30, 2022 August 31, 2022 $1,420,000 1,140,000 1,340,000 1,140,000 351,000 684,000 981,000 On January 1, 2021, the company obtained a $3,900,000 construction loan with a 12% Interest rate. The...
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 March 1, 2021 June 30, 2021 October 1, 2021 January 31, 2022 April 30, 2022 August 31, 2022 $1,310,000 1,020,000 1,220,000 1,020,000 333,000 666,000 963,000 On January 1, 2021, the company obtained a $3,700,000 construction loan with a 12% interest rate. The...
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 $ 1,090,000 March 1, 2021 780,000 June 30, 2021 980,000 October 1, 2021 780,000 January 31, 2022 297,000 April 30, 2022 630,000 August 31, 2022 927,000 On January 1, 2021, the company obtained a $3,300,000 construction loan with a 16% interest rate....
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 $ 1,350,000 March 1, 2021 1,080,000 June 30, 2021 1,280,000 October 1, 2021 1,080,000 January 31, 2022 342,000 April 30, 2022 $675,000 August 31, 2022 $972,000 On January 1, 2021, the company obtained a $3,800,000 construction loan with a 15% interest rate....
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 March 1, 2021 June 30, 2021 October 1, 2021 January 31, 2022 April 30, 2022 August 31, 2022 $1,280,000 960,000 1,160,000 960,000 324,000 657,000 954,000 On January 1, 2021, the company obtained a $3,600,000 construction loan with a 15% interest rate. The...
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 March 1, 2021 June 30, 2021 October 1, 2021 January 31, 2022 April 30, 2022 August 31, 2022 $1.850,000 1.500.000 1,700,000 1.500.000 405,000 738.000 1,035,000 On January 1, 2021, the company obtained a $4,500,000 construction loan with a 12% Interest rate. The...
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 March 1, 2021 June 30, 2021 October 1, 2021 January 31, 2022 April 30, 2022 August 31, 2022 $1.290, eee 78e, eee 980.ee 780, Bee 297, eee 630, eee 927.090 On January 1, 2021, the company obtained a $3,300,000 construction loan with...
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 March 1, 2021 June 30, 2021 October 1, 2021 January 31, 2022 April 30, 2022 August 31, 2022 $1,870,000 1,560,000 1,760,000 1,560,000 414,000 747,000 1,044,000 On January 1, 2021, the company obtained a $4,600,000 construction loan with a 15% interest rate. The...
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: January 1, 2021 March 1, 2021 $1,850,000 1,500,000 1,700,000 1,500,000 June 30, 2021 October 1, 2021 January 31, 2022 April 30, 2022 August 31, 2022 405,000 738,000 1,035,000 On January 1, 2021, the company obtained a $4,500,000 construction loan with a 12% interest rate. The...
On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows: $1,e9e, eee 780,000 98e, eee 780,eee 297,eee 630,eee 927,e00 January 1, 2021 March 1, 2021 June 30, 2021 October 1, 28e21 January 31, 2022 April 30, 2822 August 31, 2022 es On January 1, 2021, the company obtained a $3,300,000 construction loan with a 16...