Exercise 10-9On July 31, 2017, Kingbird Company engaged Minsk Tooling Company to construct a special-purpose piece of factory machinery. Construction was begun immediately and was completed on November 1, 2017. To help finance construction, on July 31 Kingbird issued a $303,600, 3-year, 12% note payable at Netherlands National Bank, on which interest is payable each July 31. $196,600 of the proceeds of the note was paid to Minsk on July 31. The remainder of the proceeds was temporarily invested in short-term marketable securities (trading securities) at 10% until November 1. On November 1, Kingbird made a final $107,000 payment to Minsk. Other than the note to Netherlands, Kingbird’s only outstanding liability at December 31, 2017, is a $32,200, 8%, 6-year note payable, dated January 1, 2014, on which interest is payable each December 31.     Calculate the interest revenue, weighted-average accumulated expenditures, avoidable interest, and total interest cost to be capitalized during 2017.Interest revenue $ Weighted-average accumulated expenditures $ Avoidable interest $ Interest capitalized $   SHOW LIST OF ACCOUNTSLINK TO TEXT   Prepare the journal entries needed on the books of Kingbird Company at each of the following dates. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)(1) July 31, 2017.(2) November 1, 2017.(3) December 31, 2017.DateAccount Titles and ExplanationDebitCredit 7/3111/112/31        (To record the note.)               (To record the payment to Minsk.)   7/3111/112/31            (To record the proceeds from the investment.)           (To record the payment to Minsk.)  12/31                 Click if you would like to Show Work for this question:Open Show Work  SHOW LIST OF ACCOUNTSLINK TO TEXT   Question

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Asked Nov 12, 2019
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Exercise 10-9

On July 31, 2017, Kingbird Company engaged Minsk Tooling Company to construct a special-purpose piece of factory machinery. Construction was begun immediately and was completed on November 1, 2017. To help finance construction, on July 31 Kingbird issued a $303,600, 3-year, 12% note payable at Netherlands National Bank, on which interest is payable each July 31. $196,600 of the proceeds of the note was paid to Minsk on July 31. The remainder of the proceeds was temporarily invested in short-term marketable securities (trading securities) at 10% until November 1. On November 1, Kingbird made a final $107,000 payment to Minsk. Other than the note to Netherlands, Kingbird’s only outstanding liability at December 31, 2017, is a $32,200, 8%, 6-year note payable, dated January 1, 2014, on which interest is payable each December 31.
 
 
 
 
 
Calculate the interest revenue, weighted-average accumulated expenditures, avoidable interest, and total interest cost to be capitalized during 2017.

Interest revenue  
$
 
Weighted-average accumulated expenditures  
$
 
Avoidable interest  
$
 
Interest capitalized  
$
 

 
 

SHOW LIST OF ACCOUNTS
LINK TO TEXT
 
 
 
Prepare the journal entries needed on the books of Kingbird Company at each of the following dates. (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

(1)   July 31, 2017.
(2)   November 1, 2017.
(3)   December 31, 2017.

Date
Account Titles and Explanation
Debit
Credit
 7/3111/112/31
 
 
 
 
 
 
 
 
(To record the note.)
   
 
 
 
 
 
 
 
 
 
 
 
 
 
(To record the payment to Minsk.)
   
 7/3111/112/31
 
 
 
 
 
 
 
 
 
 
 
 
(To record the proceeds from the investment.)
   
 
 
 
 
 
 
 
 
 
(To record the payment to Minsk.)
   
12/31
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 

Click if you would like to Show Work for this question:
Open Show Work

 

 

SHOW LIST OF ACCOUNTS
LINK TO TEXT
 
 
 
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Compute the interest revenue, weighted-average accumulated expenditures, avoida...

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Amount (S) Particulars Interest revenue (S303,600- 2,675 $196,600)*10% 3/12 Expenditure (a) Weighted expenditure a*с Capitalization period (Ъ) Weight c b/12 Date $196,600 July 31 $49,150 0.25 November 1 $107,000 $303,000 0 0 $49,150 Amount (S) 5,898 Particulars Avoidable interest ($49,150*12%) Particulars Amount (S) 5,898 interest capitalized

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