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Exercise 10-7 Page 1 of I ACCT 3110 Fall 2017/Chapter 10 Homework Exercise 10-7 Harrisburg Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $5,000,000 on January 1, 2017. Harrisburg expected to complete the building by December 31, 2017. Marrisburg has the following debt obligations outstanding during the construction period. Construction loan-12% interest, payable semiannually, issued December 31, 2016 Short-term loan-10% interest, payable monthly, and principal payable at maturity on May 30, 2018 1,400,000 Long-term loan, 11% interest, payable on January 1 of each year. Principal payable on January 1, 2021 1,000,000 $2,000,000 Assume that Harrisburg completed the office and warehouse building on December 31, 2017, as planned at a total cost of $5, voidable interest on this project. (use interest rates rounded to 2 decimal places, eg. 7.58% for computational purposes and round final answers to o decimal places, e.g. 5,275. 200,000, and the weighted-average amount of accumulated expenditures was $3,600,000. Compute the Avoidable Interest Compute the depreciation expense for the year ended December 31, 2018. Harrisburg elected to depreciate the building on a straight-line basis and determined that the asset has a useful life of 30 years and a salvage value of $300,000. (Round answer to O decimal places, e.g. 5,275.) Depreciation Expense Question Attempts: Unlimited 11/30/2017

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