On June 1, 2020, the Crocus Company began construction of a new manufacturing plant. The plant was completed on October 31, 2021 Expenditures on the project were as follows (S in milons) July 1, 2020 October 1, 2020 78 46 February 1, 2021 April 1, 2021 September 1, 2021 54 33 32 October 1, 2021 18 On July 1, 2020, Crocus obtained a $94 million construction loan with a 8% interest rate. The loan was outstanding through the end of October, 2021. The company's only other interest bearing debt was a long term note for $100 million with an interest rate of 10% This note was outstanding during all of 2020 and 2021. The company's fiscal year end is December 31t What is the amount of interest that Crocus should capitalize in 2020, using the specific interest method?

On June 1, 2020, the Crocus Company began construction of a new manufacturing plant. The plant was completed on October 31, 2021 Expenditures on the project were as follows (S in milons) July 1, 2020 October 1, 2020 78 46 February 1, 2021 April 1, 2021 September 1, 2021 54 33 32 October 1, 2021 18 On July 1, 2020, Crocus obtained a $94 million construction loan with a 8% interest rate. The loan was outstanding through the end of October, 2021. The company's only other interest bearing debt was a long term note for $100 million with an interest rate of 10% This note was outstanding during all of 2020 and 2021. The company's fiscal year end is December 31t What is the amount of interest that Crocus should capitalize in 2020, using the specific interest method?

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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