On January 1, 2018, the Shagri Company began construction on a new manufacturing facility for its own use. Thebuilding was completed in 2019. The only interest-bearing debt the company had outstanding during 2018 waslong-term bonds with a book value of $10,000,000 and an effective interest rate of 8%. Construction expendituresincurred during 2018 were as follows:January 1 $500,000March 1 600,000July 31 480,000September 30 600,000December 31 300,000Required:Calculate the amount of interest capitalized for 2018.
On January 1, 2018, the Shagri Company began construction on a new manufacturing facility for its own use. Thebuilding was completed in 2019. The only interest-bearing debt the company had outstanding during 2018 waslong-term bonds with a book value of $10,000,000 and an effective interest rate of 8%. Construction expendituresincurred during 2018 were as follows:January 1 $500,000March 1 600,000July 31 480,000September 30 600,000December 31 300,000Required:Calculate the amount of interest capitalized for 2018.
Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter13: Investments And Long-term Receivables
Section: Chapter Questions
Problem 10MC: On January 1, 2019, Park Company accepted a 36,000, non-interest-bearing, 3-year note from a major...
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On January 1, 2018, the Shagri Company began construction on a new manufacturing facility for its own use. The
building was completed in 2019. The only interest-bearing debt the company had outstanding during 2018 was
long-term bonds with a book value of $10,000,000 and an effective interest rate of 8%. Construction expenditures
incurred during 2018 were as follows:
January 1 $500,000
March 1 600,000
July 31 480,000
September 30 600,000
December 31 300,000
Required:
Calculate the amount of interest capitalized for 2018.
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