On January 2, 2020, IRG Company began the construction of a small processing plant. The plant was finished and ready for use on September 30, 2021. Expenditures for the construction were as follows: January 2, 2020 P 200,000 September 1, 2020 600,000 December 31, 2020 600,000 March 31, 2021 600,000 September 30, 2021 400,000 IRG borrowed P 1,100,000 on a construction loan at 12% interest on January 2, 2020. This loan was outstanding during the construction period.
On January 2, 2020, IRG Company began the construction of a small processing plant. The plant was finished and ready for use on September 30, 2021. Expenditures for the construction were as follows: January 2, 2020 P 200,000 September 1, 2020 600,000 December 31, 2020 600,000 March 31, 2021 600,000 September 30, 2021 400,000 IRG borrowed P 1,100,000 on a construction loan at 12% interest on January 2, 2020. This loan was outstanding during the construction period.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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- On January 2, 2020, IRG Company began the construction of a small processing plant. The plant was finished and ready for use on September 30, 2021. Expenditures for the construction were as follows:
|
January 2, 2020 |
P 200,000 |
|
September 1, 2020 |
600,000 |
|
December 31, 2020 |
600,000 |
|
March 31, 2021 |
600,000 |
|
September 30, 2021 |
400,000 |
IRG borrowed P 1,100,000 on a construction loan at 12% interest on January 2, 2020. This loan was outstanding during the construction period.
a. What were the weighted-average accumulated expenditures for 2020?
b. The interest capitalized for 2020 is ___________.
c. What were the weighted-average accumulated expenditures for 2021 by the end of the construction period?
d. The interest capitalized for 2021 is _____________
e. Interest expense for the year 2020 is ___________
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