On March 1, 2023, Spoelstra, Inc. borrows $1.120,000 on a three year, 8% loan to finance construction of a new building. Spoelstra also has $2,000,000 of 5% debt outstanding for all of 2023. During 2023, the following events occur: 6/1/23-Spoelstra makes a $332.000 payment to the construction contractor, and work begins on the project. 8/1/23-Spoelstra makes a $387,000 progress payment to the construction contractor. 11/1/23-Spoelstra makes a final payment of $299,000 to the contractor upon completion of construction. How much interest cost should be capitalized into the cost of the building?

On March 1, 2023, Spoelstra, Inc. borrows $1.120,000 on a three year, 8% loan to finance construction of a new building. Spoelstra also has $2,000,000 of 5% debt outstanding for all of 2023. During 2023, the following events occur: 6/1/23-Spoelstra makes a $332.000 payment to the construction contractor, and work begins on the project. 8/1/23-Spoelstra makes a $387,000 progress payment to the construction contractor. 11/1/23-Spoelstra makes a final payment of $299,000 to the contractor upon completion of construction. How much interest cost should be capitalized into the cost of the building?

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

Chapter10: Property, Plant And Equipment: Acquisition And Subsequent Investments

Section: Chapter Questions

Problem 6MC: Ashton Company exchanged a nonmonetary asset with a cost of 30,000 and accumulated depreciation of...

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