19) On March 1, Mocl Co. began construction of a small building. The following expenditures were incurred for construction: March 1 May 1 July 1 $225,000 540,000 300,000 April 1 June 1 $ 222,000 810,000 The building was completed and occupied on July 1. To help pay for construction $3,000,000 was borrowed on March 1 on a 10%, three-year note payable. Instructions: a) Calculate the weighted-average accumulated expenditures. A F12

19) On March 1, Mocl Co. began construction of a small building. The following expenditures were incurred for construction: March 1 May 1 July 1 $225,000 540,000 300,000 April 1 June 1 $ 222,000 810,000 The building was completed and occupied on July 1. To help pay for construction $3,000,000 was borrowed on March 1 on a 10%, three-year note payable. Instructions: a) Calculate the weighted-average accumulated expenditures. A F12

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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On March 1, Mocl Co. began construction of a small building. The following expenditures were incurred for construction: March 1 $ 300,000 April 1 $ 296,000 May 1 720,000 June 1 1,080,000 July 1 400,000 The building was completed and occupied on July 1. To help pay for construction $200,000 was borrowed on March 1 on a 12%, three-year note payable. The only other debt outstanding during the year was a $2,000,000, 10% note issued two years ago. Instructions (a) Calculate the weighted-average accumulated expenditures. (b) Calculate avoidable interest. (c) Prepare the necessary journal entry to record the capitalization of interest and the recognition of interest expense at December 31. C. Date Debit Credit
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