Solution:
Year 2018: Weighted-Average accumulated expenditure and interest capitalized | |||
Date | Expenditure | Weigh | Avearge |
01 January 2018 | $6,20,000 | 12/12 | $6,20,000 |
31 March 2018 | $12,20,000 | 9/12 | $9,15,000 |
30 June 2021 | $8,24,000 | 6/12 | $4,12,000 |
30 September 2018 | $6,20,000 | 3/12 | $1,55,000 |
31 December 2018 | $4,20,000 | 0/12 | $0 |
Accumulated Expenditure | $30,84,000 | $21,02,000 |
Weighted average interest rate of all other debt | |||
Debt | Amount | Interest rate | Interest amount |
14% Bonds | $60,00,000 | 14% | $8,40,000 |
9% Long term Note | $40,00,000 | 9% | $3,60,000 |
Totals | $1,00,00,000 | $12,00,000 | |
Weighted average rate (total interets/ total debt) | 12.00% |
Year 2018: Interest Capitalized | ||||
Average | Interest Rate | Capitalized Interest | ||
Avearge Accumulated Expenditure | $21,02,000 | |||
Specific | $17,00,000 | 9% | $1,53,000 | |
Other debt | $4,02,000 | 12% | $48,240 | |
Total Interest Capitalized | $2,01,240 |
On January 1, 2018, the Highlands Company began construction on a new manufacturing facility for its...
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