Metlock Company began construction of a new building during 2025. The building is expected to be completed on December 31, 2025. During 2025, payments to the contractor are $540,000 on January 4, $252,000 on May 1, and $456,000 on October 1. Metlock has secured a construction loan of $506,000 at 6% interest on January 4, 2025. The company also has $8,850,000 in 9% bonds outstanding in 2026 and 2025. What is the interest amount to capitalize?
Metlock Company began construction of a new building during 2025. The building is expected to be completed on December 31, 2025. During 2025, payments to the contractor are $540,000 on January 4, $252,000 on May 1, and $456,000 on October 1. Metlock has secured a construction loan of $506,000 at 6% interest on January 4, 2025. The company also has $8,850,000 in 9% bonds outstanding in 2026 and 2025. What is the interest amount to capitalize?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Metlock Company began construction of a new building during 2025. The building is expected to be completed on December 31, 2025.
During 2025, payments to the contractor are $540,000 on January 4, $252,000 on May 1, and $456,000 on October 1. Metlock has
secured a construction loan of $506,000 at 6% interest on January 4, 2025. The company also has $8,850,000 in 9% bonds
outstanding in 2026 and 2025. What is the interest amount to capitalize?
Interest to capitalize
$](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff75f7577-8a65-4e1f-8055-f9f8f9439144%2F7ad3f638-acbb-49c0-b1f7-6119e521a4a5%2F7526j0r_processed.png&w=3840&q=75)
Transcribed Image Text:Metlock Company began construction of a new building during 2025. The building is expected to be completed on December 31, 2025.
During 2025, payments to the contractor are $540,000 on January 4, $252,000 on May 1, and $456,000 on October 1. Metlock has
secured a construction loan of $506,000 at 6% interest on January 4, 2025. The company also has $8,850,000 in 9% bonds
outstanding in 2026 and 2025. What is the interest amount to capitalize?
Interest to capitalize
$
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