Assignment
On January 2, 2017, Indian River Groves began construction of a new citrus processing plant. The automated plant was finished and ready for use on September 30, 2018. Expenditures for the construction were as follows:
|
January 2, 2017
|
$ 600,000
|
|
September 1, 2017
|
1,800,000
|
|
December 31, 2017
|
1,800,000
|
|
March 31, 2018
|
1,800,000
|
|
September 30, 2018
|
1,200,000
|
Indian River Groves borrowed $3,300,000 on a construction loan at 12% interest on January 2, 2017. This loan was outstanding during the construction period. The company also had $12,000,000 in 9% bonds outstanding in 2017 and 2018.
1. What were the weighted-average accumulated expenditures for 2017?
a. $1,600,000
b. $1,500,000
c. $1,200,000
d. $3,000,000
2. The interest capitalized for 2017 was:
a. $540,000
b. $144,000
c. $456,000
d. $180,000
3. What were the weighted-average accumulated expenditures for 2018 by the end of the construction period?
a. $1,170,000
b. $4,905,000
c. $5,958,000
d. $4,158,000
4. The interest capitalized for 2018 was:
a. $374,220
b. $354,915
c. $ 77,220
d. $297,000.