4. The following information pertains to Our Company's self-constructed building projectOur Company is building a project for its own use. We have been asked to calculate the amount of interest to be capitalized.2021 Payments:1/31/212/28/21Specific construction debt:$900,000, 4%, 5-year note, dated 12/31/20,interest paid annually on 12/31415,000500,0006/1/21860,00012/1/21725,000Other debt:2,500,000$825,000, 5%, annual interest paid 12/31, dated 12/31/20$1,250,000, 7%, 10 year bonds, dated 12/31/17, interest paid 12/31How much is the weighted average of the accumulated expenditures?b. How much is the weighted average of the interest rates on other debt?c. How much is the avoidable interest?d. How much is the actual interest?e. How much is recorded as the interest expense?f. How much interest should be capitalized?a.

NOTE : As per BARTLEBY guidelines, when multiple sub parts are given, then first three sub parts are…

4. The following information pertains to Our Company's self-constructed building project Our Company is building a project for its own use. We have been asked to calculate the amount of interest to be capitalize 2021 Payments: 1/31/21 2/28/21 6/1/21 12/1/21 Specific construction debt: $900,000, 4%, 5-year note, dated 12/31/20, interest paid annually on 12/31 415,000 500,000 860,000 725,000 Other debt: $825,000, 5%, annual interest paid 12/31, dated 12/31/20 $1,250,000, 7%, 10 year bonds, dated 12/31/17, interest paid 12/31 2,500,000 How much is the weighted average of the accumulated expenditures? b. How much is the weighted average of the interest rates on other debt? c. How much is the avoidable interest? a.

4. The following information pertains to Our Company's self-constructed building project Our Company is building a project for its own use. We have been asked to calculate the amount of interest to be capitalize 2021 Payments: 1/31/21 2/28/21 6/1/21 12/1/21 Specific construction debt: $900,000, 4%, 5-year note, dated 12/31/20, interest paid annually on 12/31 415,000 500,000 860,000 725,000 Other debt: $825,000, 5%, annual interest paid 12/31, dated 12/31/20 $1,250,000, 7%, 10 year bonds, dated 12/31/17, interest paid 12/31 2,500,000 How much is the weighted average of the accumulated expenditures? b. How much is the weighted average of the interest rates on other debt? c. How much is the avoidable interest? a.

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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