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6. When computing the amount of interest cost to be capitalized, the concept of "avoidable interest" refers to A) a cost of capital charge for stockholders' equity.                                            B) that portion of weighted-average accumulated expenditures on which no interest cost was incurred.                                                                                 C) the total interest cost actually incurred.                                                       D) that portion of total interest cost which would not have been incurred if expenditures for asset construction had not been made.

6. When computing the amount of interest cost to be capitalized, the concept of "avoidable interest" refers to A) a cost of capital charge for stockholders' equity.                                            B) that portion of weighted-average accumulated expenditures on which no interest cost was incurred.                                                                                 C) the total interest cost actually incurred.                                                       D) that portion of total interest cost which would not have been incurred if expenditures for asset construction had not been made.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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6. When computing the amount of interest cost to be capitalized, the concept of "avoidable interest" refers to

A) a cost of capital charge for stockholders' equity.                                            B) that portion of weighted-average accumulated expenditures on which no interest cost was incurred.                                                                                 C) the total interest cost actually incurred.                                                       D) that portion of total interest cost which would not have been incurred if expenditures for asset construction had not been made.

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