On January 1, 2024, the Shagri Company began construction on a new manufacturing facility for its own use. The building was completed in 2025. The only interest-bearing debt the company had outstanding during 2024 was long-term bonds with a book value of $11,100,000 and an effective interest rate of 9%. Construction expenditures incurred during 2024 were as follows: January 1 March 1 July 31 September 30 December 31 $ 610,000 666,000 546,000 710,000 410,000 Required: Calculate the amount of interest capitalized for 2024. Date January 1 March 1 July 31 September 30 December 31 Accumulated expenditure Average accumulated expenditures Expenditure Weight Average X x X Amount X X Interest Rate % Capitalized Interest
On January 1, 2024, the Shagri Company began construction on a new manufacturing facility for its own use. The building was completed in 2025. The only interest-bearing debt the company had outstanding during 2024 was long-term bonds with a book value of $11,100,000 and an effective interest rate of 9%. Construction expenditures incurred during 2024 were as follows: January 1 March 1 July 31 September 30 December 31 $ 610,000 666,000 546,000 710,000 410,000 Required: Calculate the amount of interest capitalized for 2024. Date January 1 March 1 July 31 September 30 December 31 Accumulated expenditure Average accumulated expenditures Expenditure Weight Average X x X Amount X X Interest Rate % Capitalized Interest
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Transcribed Image Text:On January 1, 2024, the Shagri Company began construction on a new manufacturing facility for its own use. The building was
completed in 2025. The only interest-bearing debt the company had outstanding during 2024 was long-term bonds with a book value
of $11,100,000 and an effective interest rate of 9%. Construction expenditures incurred during 2024 were as follows:
January 1
March 1
July 31
September 30
December 31
Required:
$ 610,000
666,000
546,000
710,000
410,000
Calculate the amount of interest capitalized for 2024.
Date
January 1
March 1
July 31
September 30
December 31
Accumulated expenditure
Average accumulated expenditures
Expenditure
Weight
Average
X
Amount
X
X
x
x
X
Interest
Rate
%
Capitalized
Interest
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