Answered: the amount of interest that should be…

Business

Accounting

the amount of interest that should be capitalized by Sunland during 2020?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Q: The following information relates to Samson Engineering as at 30 June 2023: RProfit for the year180…

A: The objective of the question is to calculate the total non-current assets, total current assets,…

Q: The following information relates to Samson Engineering as at 30 June 2023: RProfit for the year180…

A: The objective of the question is to calculate the total non-current assets, total current assets,…

Q: . On January 1, 20x1, ABC sold a used vehicle with a historical cost of P2,000,0000 and accumulated…

A: Carrying Amount is the book value of an Assest which is recorded in financial Statement . When the…

Q: Moletji Ltd is public company owned by two prominent business women and the local community trust…

A: Cash flow statement is a statement of cash inflow and cash outflow. It represents the cash movements…

Q: Trump Company constructed various assets at a total cost of $8,400,000 during 2019. The weighted…

A: Particulars Principal Interest 9% ,3-years bond 20,00,000 1,80,000 10%,5-year bond…

Q: January 20x3. During 20x3, Cole incurred intere on specific construction debt, and P20,000…

A: The Interest cost of specific borrowing incurred for the construction of a fixed asset or interest…

Q: The following are the relevant information about BOMM Company PPE and bonds payable at year end:…

A: Cash flow from investing activities: It is a section of the cash flow statement that shows the cash…

Q: 1. The following information is from Direct to You Corp.’s (DYC) financial records for its year…

A: Cash flow from investing activities includes sale/purchase of PPE, investments, intangible assets,…

Q: In February 2024, Cullumber Corp, began the construction of a 10-storey building. The construction…

A: Notes:The notes in accounting are the legal document that represents the loan amount which is issued…

Q: Assuming the investment is appropriately recognized as financial assets at amortized cost: How much…

A: A bond is a kind of debt financial instrument that is being issued by corporations and the…

Q: Capitalized Interest: The following series of questions relate to this data set.... California…

A: Interest is a cost of debt that is paid at an interval till the debt is repaid. In the case of…

Q: Problem 10: Use the following information for the next three questions: On January 1, 2021, DELAY…

A: Since you has posted multiple questions we will answer the first question for you as per the…

Q: On July 1, 2024, a company acquired equipment. The company paid $210,000 in cash on July 1, 2024,…

A: The note can be issued in exchange of cash while purchasing the asset. The zero interest bearing…

Q: Ray Company had the following liabilities on December 31, 2021: · Trade accounts payable, net…

A: Current liabilities: Liabilities that have to be paid within one year or one operating cycle,…

Q: Calculate the amount of taxable income for 2020. Taxable income, 2020 $. Enter your answer in…

A: There are temporary differences which causes the differences of the incomes as per two separate…

Q: On December 31, 2024, Sheffield Inc. borrowed $4.020,000 at 13% payable annually to finance the…

A: Journal entries act as the fundamental building blocks for solutions to those questions and others..…

Q: During 2019, Bing Company constructed its own equipment costing P5,000,000. The weighted average…

A: The question is based on the concept of Accounting Standard on Borrowing Cost.

Q: On January 1, 2021, the Shagri Company began construction on a new manufacturing facility for its…

A: Lets understand the basics.Borrowing cost incurred on the qualifying asset needs to capitalized.…

Q: Exercise 10-24 (Algo) Interest capitalization [L010-7] On January 1, 2021, the Highlands Company…

A: Expenditure×Weight=Average

Q: Our company shows, among other things, the following items at the beginning and end of 2020 in tsek:…

A: Calculation of opening capital : Balance sheet as on 01.01.2020 Liabilities Amount Assets Amount…

Q: The following breakdown of the MNO Corporation's property, plant and equipment and bonds payable is…

A: Cash flow from investing activities: It is a section of the cash flow statement that shows the cash…

Q: iken fro Igado Company s 20 Tinancial records! Pretax accounting income- P1,500,000 Accrued warranty…

A: tax rate 2020 - 30% 2021- 32% 2022 - 34% 2023 - 35%

Q: E9.9 (LO 2) (Capitalization of Interest) On December 31, 2024, Main Inc. borrowed $3,000,000 at 12%…

A: expenses incurred to improve the efficacy and efficiency of the fixed assets utilized in operations…

Q: For the year 2020, Tonkatsu Company reported income tax expense of P110,000. Income tax payable at…

A: Calculation of amount of income tax paid during the year... Income tax payable for 2019::P90,000..…

Q: these assets during 2020 was $2470000. To help pay for construction, $1710000 was borrowed at 11% on…

A: The correct answer option is $264,100 = Construction Loan × Rate of borrowing +…

Q: On March 1, 2022, Lindor Corp. (a private company) factored receivables with a carrying amount of…

A: Loss on disposal refers to an amount that shows the difference between the cost and sale price of…

Q: None

A: Year 2025:DateAmountCapitalization periodWeighted Average Accumulated ExpendituresJanuary 01,…

Q: What is the noncontrolling interest in net income?

A: Non Controlling interest - Revenue $2,500,000 - Expenses $2,000,000

Q: 24, Cicero Corporation borrowed $ loan will be paid back in three equa e interest at a rate of 7%

A: Borrowed amount = $3,000,000 Rate of interest = 7% Time = 3 years Annual installment = $1,143,155

Q: In 2020, ABC Industries, Inc. constructed a new manufacturing facility at a cost of ₱12,000,000. The…

A: IAS 23 deals with this the concept relating to borrowing cost. As per the IAS borrowing cost…

Q: l workings. i. Avoidable interest. ii. Total interest to be capitalized during 2019. Explain the…

A: Interest costs that could have been avoided by using a weighted average expenditure. Explanation:…

Q: An entity purchased 4 year debt instruments with a face value of P15,000,000 on January 1, 2019 to…

A: Note:- Since you have posted a question with multiple sub-parts, we will solve the first three…

Q: Complete this question by entering your answers in the tabs below. Required 1 Calculation General…

A: ParticularsAmount (In '000)Rate of TaxTaxRecorded asPretax accounting income $ 1,048.00…

Q: The Montana Company paid for the acquisition of an equipment by signing a $100,000 three year 6%…

A: Year cash flows Pv factor @ 10% Present value a b c d= b x c 1 6000 0.9091 5455 2 6000 0.8264…

Q: During 2025, Crane Company constructed assets costing $4070000. The weighted-average accumulated…

A: Capitalization of costs are considered as part of fixed assets instead of stating them as expenses…

Q: On January 1, 20x1, ABC sold a used vehicle with a historical cost of P2,000,0000 and accumulated…

A: Carrying value of Vehicle sold: Historical cost = p2,000,000 Accumulated depreciation = p700,000…

Q: 4. The following information pertains to Our Company's self-constructed building project Our Company…

A: NOTE : As per BARTLEBY guidelines, when multiple sub parts are given, then first three sub parts are…

Q: Cass Corporation reported pretax book income of $11,730,000. During the current year, the reserve…

A: The main objective of the business is to earn profit. The business makes income and pays taxes to…

Q: What is the current tax expense for 2020? (Round answer to whole number)

A: pretax financial income of P6,200,000 for the calendar year 2020Income tax return reported…

Q: The following information relates to Samson Engineering as at 30 June 2023: RProfit for the year180…

A: The objective of the question is to calculate the total non-current assets, total current assets,…

Question

Q10.9

During 2020, Sunland Company incurred weighted-average accumulated expenditures of $1570000 during construction of assets that qualified for capitalization of interest. The only debt outstanding during 2020 was a $2040000, 9%, 5-year note payable dated January 1, 2020. What is the amount of interest that should be capitalized by Sunland during 2020?

$0.

$42300.

$183600.

$141300.

Expert Solution

This question has been solved!

Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.

This is a popular solution!

SEE SOLUTION Check out a sample Q&A here

Calculation of interest on note payable

VIEW

Calculation of amount of interest to be capitalized during 2020

VIEW

Answer

VIEW

Trending now

This is a popular solution!

Step by step

Solved in 3 steps

SEE SOLUTION Check out a sample Q&A here

Similar questions

33
29. The entity purchased land paying P200,000 cash and non-interest bearing note amounting to P1,000,000. The note is payable in 4 equal annual installments. The first installment payment is at the transaction date. If the effective rate of the note is equal to 10%, how much is the cost of the equipment?Group of answer choices792,466992,4661,071,713781,713
N1. Account
am.103.
am. 85.
Capitalized interest on Groupers financial statements?
b
1.On January 1, 2021, ABC Company acquired an equipment from DEF Company in lieu of cash payment, ABC Company gave DEF Company a 3-year, 3%, P2,000,000 interest-bearing note payable. The interest is payable every December 31 while the principal shall be payable as follows: December 31, 2021, P1,200,000; December 31, 2022, P400,000; and December 31, 2023, P400,000. The prevailing rate of interest for this type of note is 12%. How much is the cost of the equipment acquired on January 1, 2021? How much is the interest expense for 2021?
Net income $70,000, tax rate 25%, and loss from discontinued operations net of tax $5,000. Compute the income before income tax. Your answer This is a required question During 2021, Kamal Co. incurred average accumulated expenditures of $400,000 during construction of assets that qualified for capitalization of interest. The company has two debts outstanding during 2021. the first is a $500,000, 10%, 5- year note payable dated January 1, 2019. the second is a specific construction debt of $300,000, 8%, 3-year note payable dated September 1, 2020. 1- compute the amount of actual interest during 2021. 2- compute the amount of avoidable interest during 2021. Your answer This is a required question
15. On January 1, 20x1, ABC sold a used vehicle with a historical cost of P2,000,0000 and accumulated depreciation of P700,000 in exchange for cash of P100,000 and a noninterest bearing note receivable of P1,000,000 due in 4 equal annual installments starting on December 31, 20x1 and every December 31, thereafter. The prevailing rate of interest for this type of note is 12%. On December 31, 20x3, the current portion of the note receivable is approximately (use 6-decimal present value factor)
14. The records for ABC Co. show this data for 2020: • Gross profit on installment sales recorded on the books was P300,000. Gross profit from collections of installment receivables was P220,000. • Life insurance on officers was P3,800. (ABC Company is the beneficiary.) • Machinery was acquired in January for P300,000. Straight-line depreciation over a ten-year life (no salvage value) is used. For tax purposes, accelerated depreciation is used and ABC may deduct 14% for 2020. • Interest received on tax exempt Iowa State bonds was P9,000. • The estimated warranty liability related to 2020 sales was P19,600. Repair costs under warranties during 2020 were P13,600. The remainder will be incurred in 2021. For tax purposes. Expenses related to warranty is to be deducted when repair costs are actually rendered. • Pretax financial income is P450,000. The tax rate is 30%. The total income tax expense for the year 2020 would be?