On January 1, 2020 there is a P300,000 balance in Construction in progress-building account. Included in that balance is P60,000 of interest capitalized in the first two years of the construction. Construction expenditures during the year 2020 were P800,000 which were incurred evenly throughout the entire year. The company has had over P3,000,000 in interest-bearing debt outstanding in 2020, at a weighted average rate of 9%. How much interest is capitalized in 2020?  a. P36,000 b. P63,000 c. P93,600 d. P99,000

Q: During 2020, Glass Corporation constructed assets costing $1,000,000. The weighted- average…

A: Borrowing cost means where the assets like building , take substantial time to build , then interest…

Q: The following events occurred during the year ended 30 June 2020 for Electrical Limited. On 1 June…

A: As posted multiple sub parts we are answering only first three sub parts kindly repost the…

Q: On June 30, 2021, Casio Sony Company sold a property carried in inventory at a cost of P1,894,200…

A:

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: n January 1, 2020, Christine Company borrowed P30,000,000 at 12% to finance partly the construction…

A: Interest to be capitalised on Decemeber 31, 2020 = 12% x P30000000  =P 3600000  = P3600000

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

A: IAS 23 deals with the standard on borrowing cost. As per this standard borrowing cost that are…

Q: During 2020, Israel Company constructed asset costing P4,215,000. The weighted average accumulated…

A: Calculation of capitalization rate for general borrowing :                  Loan / Note Payable…

Q: On January 1, 2021, the Marjlee Company began construction of an office building to be used as its…

A: The question is related to Borrowing Cost. Weighted Average rate is calculated on long term loan…

Q: On September 1, 2020, Kayo Na Consulting. began a service proprietorship with an initial investment…

A: Under the cash basis method of accounting, the revenues as well as the expenses are recorded at the…

Q: On July 31, 202O, Teal Company engaged Minsk Tooling Company to construct a special-purpose piece of…

A: The question is based on the concept of Financial Accounting.

Q: Prob dapted) During 2020, Elijah Company constructed a new building at cost of P30,000,000. The…

A: Cost of new building  = P30000000 Weighted  average  expenses = P30000000/2 =P15000000

Q: United Supply has a $45 million liability at December 31, 2021, of which $9 million is payable in…

A: Current liability: Liabilities which have to be paid with in next one year from the date of the…

Q: On January 1, 2020, Glucose Company, a calendar-year firm, extended a loan to Gyoza Enterprises…

A: CARRYING VALUE IS AN ACCOUNTING MEASURE OF VALUE IN WHICH THE VALUE OF AN ASSET OR COMPANY IS BASED…

Q: On January 1, 2021, the Montgomery Company agreed to purchase a building by making six payments. The…

A: Cost of building:         Annual payment PV Factor at 9% Present Value Year 1 $44,000 0.91743…

Q: Celia Corp. has estimated that total depreciation expense for the year ending 12/31/20 will amount…

A: The correct option is option “C”.

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

A: Capitalized interest refers to the amount of interest that is added to the cost of the fixed asset.…

Q: intermediate accounting

A: The unpaid balance of interest is added to the principal amount of loan, this is called interest…

Q: On March 31, 2020, the CHICAGO BULLS Corporation issued a P3, 000, 000 12% promissory note for…

A: Interest expense from January 1 2021 to March 31 2021 = Amount payable x rate of interest x no. of…

Q: On January 1, 2021, the Marjlee Company began construction of an office building to be used as its…

A:

Q: Novak, Inc. has a fiscal year ending April 30. On May 1, 2020, Novak borrowed $10,728,000 at 11% to…

A: Interest to be capitalized to building  since it is a qualifying asset

Q: on January 1, 2020, Katrina Company obtained a loan of P4,000,000 at anpomt interest rate of 10%…

A: PLEASE LIKE THE ANSWER, YOUR RESPONSE MATTERS     Solution       Amount P   Total borrowing…

Q: During 2021, Happy Company constructed asset costing P10,000,000. The weighted average expenditures…

A: Borrowing cost means where the assets like building , take substantial time to build , then interest…

Q: On January 1, 2020, Karakaraka Co. started construction of a new office building on January 1, 2020,…

A: Borrowed funds used for building=P20,0002=P10,000

Q: On January 1, 2020, Marigold, Inc. signed a fixed-price contract to have Builder Associates…

A: Capitalized interest:   Capitalized interest is an accounting practice required under the accrual…

Q: On January 1, 2020, Heavy Corporation that manufactures heavy equipment sold an equipment for…

A: In the instalments type of sale, the income is not recognized until full instalments are received…

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: Balance Corporation borrowed P10,000,000 at 12% to finance in part the construction of a new office…

A: Loan Amount = 10,000,000 Expenditure incurred = 8,000,000 Average Expenditure = 8,000,000/2 =…

Q: On January 1, 2020, Pharoah Company, a calendar-year company, issued $2160000 of notes payable, of…

A:

Q: appropriated retained earnings

A: The appropriated earnings of P1,750,000 for new office building is cancelled upon completion of the…

Q: For the next two items: A company sold a factory on January 1, 2016 for P7,000,000. The entity…

A: When a factory is sold the payment can be received outrightly or over a period of when credit is…

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

A: Trump had various debts outstanding on which Interest is to be calculated at different rates given…

Q: Vilma Company has estimated that total depreciation expense for the year ended December 31, 2020…

A: Income Statement: Income statement is one of the accounting reports which depicts the overall…

Q: Deem Holdings Inc had cash and cash equivalents at January 1, 2019 of P400,000. The transactions and…

A: Cash Flow Statement - Under Cash Flow, there are three types of activities involved - Operating…

Q: On January 1, 2020, Katrina Company obtained a loan of P4,000,000 at an interest rate of 10%…

A: Borrowing cost which are related to the funds used for the qualifying asset till completion, must…

Q: On January 1, 2021, Anna Company sold a piece of equipment to Banana Company with a cost of…

A: Basic Accounting Concept  Sales of Assets in exchange of Note receivable Amortization of Loan…

Q: On January 1, 2021, the Marjlee Company began construction of an office building to be used as…

A: Solution: Weighted average interest rate of all other debt Debt Amount Interest rate Interest…

Q: On January 1, 2020, Elmer Company, a calendar-year company, issued $2,000,000 of notes payable, of…

A: In case a portion of a debt is payable within next year, then that portion is reported as current…

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

A: Date Expenditure x Weight = Average January 1 $500,000 x 12/12 = $500,000…

Q: A company acquires assets recorded at $240,000 by paying $120,000 cash and taking on a 12 year…

A: Loan =240000-120000=120000/24=$5000 So instalment $5000 semi annual…

Q: Vilma Company has estimated that total depreciation expense for the year ended December 31, 2020…

A: Interim reporting means to report the data in the financial statements for a period which is shorter…

Q: BTS Inc. started construction of a building for its own use on January 1, 2021.   Upon completion at…

A: Businesses raise money to finance their projects and expansion activities. The financing is made…

Q: ABC Construction started 2020 with the following accounting data: $280,000 in monthly revenue for…

A: Every business is liable to pay a certain amount to its employees in return for their services. A…

Q: Black Widow Company borrowed P15,000,000 at 12% to finance in part the construction of a new…

A: Answer Calculation of amount of interest to be capitalized Average expenditures on warehouse =…

Q: Grouper, Inc. has a fiscal year ending April 30. On May 1, 2020, Grouper borrowed $9,912,000 at 11%…

A:

Q: On January 1, 2022, AA Company received cash of P1,000,000 and a 4-year, oninterest bearing note to…

A: Solution Given Life of note 4 years Amount to be collected every year 600000…

Q: Capitalized interest on Groupers financial statements?

A:

Q: Tibker Company entered into a four-year P5,000,000 construction contract which was completed in…

A: Percentage of Completion Method In the percentage of  completion method of  contract first to…

Q: On January 1, 2018, the Shagri Company began construction on a new manufacturing facility for its…

A: On January 1, 2018, the Shagri Company began construction on a new manufacturing facility for its…

Contract Costing

Contract costing is about tracing particular costs related to a particular contract entered into with the customer. It is one of the forms of job order costing. It is useful in long-term contracts at the most. It is seen that substantial time is required for the completion of the contract which takes different accounting periods. Thus, it is very much helpful for recognizing the costs associated with it and accounting in their specific accounting periods.