Lapann Company is into a business of construction. The company is constructing a building that was started on February 1 and was completed on December 31. Following are the expenditures incurred during the periodMarch 01June 01December 31$2.920,000$2,248,000$4,058,100On March 1, the company borrowed $2,059,300, 5-Year, 13% note for financing the construction. The company also had $3,480,400, 5-Year, 10% note payable and $4,566,400, 4-year, 1% note payable outstanding throughout the yearDetermine the avoidable interest for the company if the company uses weighted-average interest rate for interest capitalization purposes. (Do not round the intermediate calculations. Round the final answer to the nearest whole dollar$663.4261318.0535445,8105850344

To calculate the weighted-average interest rate, we first need to calculate the total interest for…

Answered: Lapann Company is into a business of…

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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A company constructs a building for its own use. Construction began on January 1 and ended on December 30. The expenditures for construction were as follows: January 1, $590,000; March 31, $690,000, June 30, $490,000; October 30, $870,000. The company arranged a 8% loan on January 1 for $880,000. Assume the $880,000 loan is not specifically tied to the construction of the building. The company's other borrowings, outstanding for the whole year, consisted of a $4 million loan and a $6 million note with interest rates of 12% and 7%, respectively. Assuming the company uses the weighted-average method, calculate the amount of interest capitalized for the year. A company constructs a building for its own use. Construction began on January 1 and ended on December The expenditures for construction were as follows: January 1, $590,000; March 31, $690,000; June 30, $490,000; October 30, $870,0 00. The company arranged a 8% loan on January 1 for $880,000. Assume the $880,000 loan is not…
On March 1, Gatt Co began construction of a small building. The following expenditures were incurred for construction: March 1: $75,000 April 1: $74,000 May 1: $180,000 June 1: $270,000 July 1: $100,000 The building was completed and occupied on July 1. To help pay for the construction, $50,000 was borrowed on March 1 on a 12%, three year note payable. The only other debt outstanding during the year was a $500,000, 10% note issued two years ago. 1. Calculate the weighted-average accumulated expenditures Use commas, but do not use $ signs or cents. Question 11 Calcualte the actual interest cost incurred during the year. 4 pts
* Your answer is incorrect. Sheridan Company is constructing a building. Construction began on February 1 and was completed on December 31. Expenditures were $1,872,000 on March 1, $1,272,000 on June 1, and $3,047,000 on December 31. Sheridan Company borrowed $1,008,000 on March 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 9%, 5-year, $2,398,000 note payable and an 10%, 4-year, $3,715,000 note payable. Compute avoidable interest for Sheridan Company. Use the weighted-average interest rate for interest capitalization purposes. (Round weighted average interest rate to 4 decimal places, e.g. 0.2152 and final answer to 0 decimal places, e.g. 5,275.) Avoidable interest $ eTextbook and Media 2302000
Current Attempt in Progress Crane Company is constructing a building. Construction began on February 1 and was completed on December 31. Expenditures were $1,800,000 on March 1, $1,200,000 on June 1, and $3,026,000 on December 31. Crane Company borrowed $1.159,000 on March 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 9%, 5-year, $2,017,000 note payable and an 10 %, 4-year, $3,600,000 note payable. Compute avoidable interest for Crane Company. Use the weighted-average interest rate for interest capitalization purposes. (Round weighted- average interest rate to 4 decimal places, eg. 0.2152 and final answer to 0 decimal places, e.g. 5,275.) I Avoidable interest $ eTextbook and Media Save for Later Assistance Used Attempts: 0 of 3 used Submit Answer
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Company's total assets and liabilities by the end of April Total Assets (Cash only): $2,787,000 Total Liabilities: $1,863,000 Construction project Contract terms Duration: 4/1 ~ 12/31 Contract amount: $624,000 with the owner $598,000 with the subcontractors including the suppliers Terms of payment: Monthly payment The owner pays the contractor within a month after the contractor bills the owner. The owner holds 5% of each payment to the contractors for retention. The contractor pays the subcontractors within a month after the subcontractors bill the contractor. The contractor holds 5% of each payment to the subcontractors for retention. Information related to revenues and expenses in the project 4/1 Project Start 4/26 The subcontractors billed $54,000 to the contractor. 4/30 The contractor billed $57,000 to the owner. 5/20 The owner paid 95% of the amount that the contractor billed in March to the contractor. 5% was held for retention. 5/20 The contractor paid 95% of the…
A company began constructing a new warehouse for its operations during the current year. In the year the company incurred interest of $20,000 on a working capital loan, and interest on a construction loan for the warehouse of $80,000. Interest computed on the average accumulated expenditures for the warehouse construction was $40,000. What amount of interest should be expensed for the year?
Subject: accounting
Vala
As during eighth year, Clark Company spent $2,400,000 on equipment for its own use. The project took a whole year to complete, and all expenditures were spread out evenly over the year. Clark was able to borrow $1,500,000 at 6% interest at the start of the term for the procurement of materials and the fabrication of the equipment. On December 31, year 8, the whole debt, including interest, was redeemed and replaced with a long-term loan. Clark Company has an extra debt of $1,000,000 in year 8, with a weighted average interest rate of 7%. What will Clark Corporation report as interest cost in year 8 if it capitalises the maximum amount of interest allowed under GAAP? Asap
Vala
With the following transactions, determine the Cost of Good Sold for a Manufacturing plant. 1. A $7000 loan was obtained and deposited in cash. 2. Another loan was obtained for the purchase of new equipment for the amount of 5539 with 5 years of life. 3. The equipment is depreciated for the first year. 4. Direct Labor is paid for the amount of 322. 5. Packaging employees are paid for 997. 6. 200 materials were invoiced at 2 each for the inventory. 7. 150 materials were used in production. 8. The 150 units were sold at $4.00 each and they are invoiced. 9. Sales and distribution expenses for $1000 were paid.

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