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, issued at par on May 31, 2020, with interest payable annually on May 31. |
2. | 300,000 shares of no-par common stock, issued at $10 per share on October 1, 2020. |
In addition to the 9% bonds payable, the only debt outstanding
during 2020 was a $467,500, 12% note payable dated January 1, 2016
and due January 1, 2023, with interest payable annually on January
1.
Compute the amounts of each of the following:
1. | Weighted-average accumulated expenditures qualifying for capitalization of interest cost. | |
2. | Avoidable interest incurred during 2020. | |
3. | Total amount of interest cost to be capitalized during 2020. |
1. | Weighted-average accumulated expenditures | $ | ||
2. | Avoidable interest | $ | ||
3. | Amount of interest cost to be capitalized | $ |
Testbank Problem 140 Early in 2020, Dobbs Corporation engaged Kiner, Inc. to design and construct a...
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, 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 June 1, 2020 August 31, 2020 December 31, 2020 Payment $2,280,000 3,420,000 2,850,000 In order to help finance the construction, Dobbs issued the following during 2020: 1. $1,938,000 of 10-year, 9% bonds payable, issued at par...
Early in 2017, Dobbs Corporation engaged Kiner, Inc. to design and construct a complete modernization of Dobbs's manufacturing facility. Construction was begun on June 1, 2017 and was completed on December 31, 2017. Dobbs made the following payments to Kiner, Inc. during 2017: Date June 1, 2017 August 31, 2017 December 31, 2017 Payment $6,156,000 9,168,000 7,404,000 In order to help finance the construction, Dobbs issued the following during 2017: 1. $5,190,000 of 10-year, 9% bonds payable, issued at par...
Early in 2017, Dobbs Corporation engaged Kiner, Inc. to design and construct a complete modernization of Dobbs's manufacturing facility. Construction was begun on June 1, 2017 and was completed on December 31, 2017. Dobbs made the following payments to Kiner, Inc. during 2017: Date Payment June 1, 2017 $2,000,000 August 31, 2017 3,000,000 December 31,2017 2,500,000 In order to help finance the construction, Dobbs issued the following during 2017: 1. $1,700,000 of 10-year, 9% bonds payable, issued at par on...
4. total interest to be capitalize during 2010 Early in 2010, Dobbs Corporation engaged Kiner, Inc. to design and construct a complete modernization of Dobbs's manufacturing facility. Construction was begun on June 1, 2010 and was completed on December 31, 2010. Dobbs made the following payments to Kiner, Inc. during 2010: Date Payment June 1, 2010 $3,600,000 August 31, 2010 5,400,000 December 31, 2010 4,500,000 In order to help finance the construction, Dobbs issued the following during 2010: 1. $3,000,000...
. 2017 and was Question Early in 2017. Dobbs Corporation engaged Kiner, Inc. to design and construct a complete modernization of Dobb's manufacturing facility. Construction was begun completed on December 31, 2017. Dobbs made the following payments to the during 2017: Payment June 1, 2017 $5,772,000 August 31, 2017 9,000,000 December 31, 2017 7,572,000 Date In order to help finance the construction, Dobbs issued the following during 2017: 1. $5.000.000 of 10-year bonds payable, issued at pron May 31, 2017,...
Early in 2020, Qatar Corporation engaged Emirate Ltd. to design and construct a complete modernization of Qatar’s manufacturing facility. Construction began on June 1, 2020, and was completed on December 31, 2020. Qatar made the following payments to Emirate Ltd. during 2020: Date Payment June 1, 2020$ 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,...
Q3. (25 marks) 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...