Instructions
Prepare the entry that should have been made at the date of each acquisition.
E10-7 (Capitalization of Interest) Harrisburg Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $5,000,000 on January 1, 2014. Harrisburg expected to complete the building by December 31, 2014. Harrisburg has the following debt obligations outstanding during the construction period.
Construction loan�12% interest, payable semiannually, issued December 31, 2013 $2,000,000
Short-term loan�10% interest, payable monthly, and principal payable at maturity on May 30, 2015. $1,400,000
Long-term loan�11% interest, payable on January 1 of each year. Principal payable on
January 1, 2018 $1,000,000
(Carry all computations to two decimal places.)
(a)Assume that Harrisburg completed the office and warehouse building on December 31, 2014, as planned at a total cost of $5,200,000, and the weighted-average amount of accumulated expenditures was $3,600,000. Compute the avoidable interest on this project.
(b) Compute the depreciation expense for the year ended December 31, 2015. Harrisburg elected to depreciate the building on a straight-line basis and determined that the asset has a useful life of 30 years and a salvage value of $300,000
(c) Calculate actual interest, and record the entry for the transaction.
Answer:-
if you have any query please ask me in comment box i am here to helps you don't give direct Thumbs down.if you satisfied my work give Thumbs UP
*******THANK YOU*******
Instructions Prepare the entry that should have been made at the date of each acquisition. E10-7...
Acquisition and Disposition of Property, Plant, and Equipment Instructions Prepare the entry that should have been made at the date of each ac made at the date of each acquisition. (LO 2) (Capitalization of Interest) Harrisburg Furniture Compa of a combination office and warehouse building for its own January 1, 2020. Harrisburg expected to complete the building by December 31, following debt obligations outstanding during the construction period. sburg Furniture Company started construction "Bor its own use at an estimated...
quisition and Disposition of Property, Plant, and Equipment Instructions Prepare the entry that should have been made at the dat E10.7 (LO 2) (Capitalization of Interest) Harrisburg of a combination office and warehouse building for its own use at an estimates January 1, 2020. Harrisburg expected to complete the building by Decem arrisburg expected to complete the building by December 31, 2020. Harrisburg nasce following debt obligations outstanding during the construction period. anization of Interest) Harrisburg Furniture Company started construction...
103) (Capitalization of Inter TO LOS house building rusting by Decemb wach acquisition ation of Interest) Harrisburg Furniture Company started construction of for its own use at an estimated cost of $5,000,000 on January 1, 2017. Harrisburg expected to com Furniture Company started construction of a combination office and umber 31, 2017. Harrisburg has the follow nowing debt obligations outstanding during the construction period. Construction loan-12% Interest, payable semiannually, issued December 31, 2016 $2,000,000 Short-term loan-10interest, payable monthly, and principal...
Harrisburg Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $5,000,000 on January 1, 2020. Harrisburg expected to complete the building by December 31, 2020. Harrisburg has the following debt obligations outstanding during the construction period. Construction loan-12% interest, payable semiannually, issued December 31, 2019 $2,000,000 Short-term loan-10% interest, payable monthly, and principal payable at maturity on May 30, 2021 1,400,000 Long-term loan-11% interest, payable on January 1 of...
Exercise 10-07 Sheridan Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $13,000,000 on January 1, 2020. Sheridan expected to complete the building by December 31, 2020. Sheridan has the following debt obligations outstanding during the construction period. Construction loan-12% interest, payable semiannually, issued December 31, 2019 $5,200,000 Short-term loan-10% interest, payable monthly, and principal payable at maturity on May 30, 2021 3,640,000 Long-term loan-11% interest, payable on January...
E10.7B (L0 2) (Capitalization of Interest) Bagwell Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $2,500,000 on January 1, 2020. Bagwell expected to complete the building by December 31, 2020. Bagwell has the following debt obligations outstanding during the construction period. Construction loan—15% interest, payable semiannually, issued December 31, 2019 Short-term loan—10% interest, payable monthly, and principal payable $1,000,000 at maturity on May 30, 2021 Long-term loan—11% interest,...
Exercise 10-07 Sarasota Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $14,500,000 on January 1, 2020. Sarasota expected to complete the building by December 31, 2020. Sarasota has the following debt obligations outstanding during the construction period. Construction loan-12% interest, payable semiannually, issued December 31, 2019 $5,800,000 Short-term loan-10% interest, payable monthly, and principal payable at maturity on May 30, 2021 4,060,000 Long-term loan-11% interest, payable on January...
Pronghorn Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $8,500,000 on January 1, 2020. Pronghorn expected to complete the building by December 31, 2020. Pronghorn has the following debt obligations outstanding during the construction period. Construction loan-10% interest, payable semiannually, issued December 31, 2019 $3,400,000 Short-term loan-8% interest, payable monthly, and principal payable at maturity on May 30, 2021 $2,380,000 Long-term loan-9% interest, payable on January 1 of...
Coronado Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $7,500,000 on January 1, 2020. Coronado expected to complete the building by December 31, 2020. Coronado has the following debt obligations outstanding during the construction period. Construction loan-12% interest, payable semiannually, issued December 31, 2019 $3,000,000 Short-term loan-10% interest, payable monthly, and principal payable at maturity on May 30, 2021 2,100,000 Long-term loan-11% interest, payable on January 1 of...
Exercise 10-07 Tamarisk Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $9,000,000 on January 1, 2020. Tamarisk expected to complete the building by December 31, 2020. Tamarisk has the following debt obligations outstanding during the construction period. Construction loan-12% interest, payable semiannually, issued December 31, 2019 Short-term loan-10% interest, payable monthly, and principal payable at maturity on May 30, 2021 Long-term loan-11% interest, payable on January 1 of...