Question

Ex. 10-132-Weighted-Average Accumulated Expenditures On April 1, Paine Co. began construction of a small building. Payments of $180,000 were made monthly for four months beginning on April 1. The building was completed and ready for occupancy on August 1. For the purpose of determining the amount of interest cost to be capitalized, calculate the weighted-average accumulated expenditures on the building by completing the schedule below: Capitalization Date Period Expenditures Weighted-Average Expenditures

Answer 1

Solution:

Schedule of Weighted-Average accumulated expenditure
Date	Amount	Current year capitalization period	Weighted Average Accumulated Expenditures
1-Apr	$180,000.00	4/12	$60,000
1-May	$180,000.00	3/12	$45,000
1-Jun	$180,000.00	3/12	$30,000
1-Jul	$180,000.00	1/12	$15,000
	$720,000.00		$150,000