On January 1, 2024, a company began construction of an automated cattle feeder system. The system was finished and ready for use on September 30, 2025. Expenditures on the project were as follows: January 1, 2024 September 1, 2024 $ 275,000 $ 390,000 December 31, 2024 $ 390,000 March 31, 2025 $ 390,000 September 30, 2025 $ 275,000 The company borrowed $780,000 on a construction loan at 9% interest on January 1, 2024. This loan was outstanding throughout the construction period. The company had $4,650,000 in 9% bonds payable outstanding in 2024 and 2025. Average accumulated expenditures for 2025 was:

On January 1, 2024, a company began construction of an automated cattle feeder system. The system was finished and ready for use on September 30, 2025. Expenditures on the project were as follows: January 1, 2024 September 1, 2024 $ 275,000 $ 390,000 December 31, 2024 $ 390,000 March 31, 2025 $ 390,000 September 30, 2025 $ 275,000 The company borrowed $780,000 on a construction loan at 9% interest on January 1, 2024. This loan was outstanding throughout the construction period. The company had $4,650,000 in 9% bonds payable outstanding in 2024 and 2025. Average accumulated expenditures for 2025 was:

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 January 1, 2024, a company began construction of an automated cattle feeder system. The system was finished and ready for use on September 30, 2025. Expenditures on the project were as follows: January 1, 2024 $ 200,000 September 1, 2024 $ 300,000 December 31, 2024 $ 300,000 March 31, 2025 $ 300,000 September 30, 2025 $ 200,000 The company borrowed $750,000 on a construction loan at 12% interest on January 1, 2024. This loan was outstanding throughout the construction period. The company had $4,500,000 in 9% bonds payable outstanding in 2024 and 2025. Interest (using the specific interest method) capitalized for 2025 was: $86,805. $87,875. $67,500. $104,625. PLEASE DO NOT GIVE SOLUTION IN IMAGE FORMAT
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