Li Corp. purchased a container load of antiques for resale at an invoice cost of...
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Accounting
Li Corp. purchased a container load of antiques for resale at an invoice cost of $2,000,000. The goods were paid for when they were shipped in early June. The container arrived in Canada at the end of August, and then at Lis location, by rail, at the end of September. The goods were then available for sale. Freight costs of $210,000 were paid in October. Li has recorded $60,000 of total interest expense from $2,000,000 of general borrowing over the year.
Required: Prepare the adjusting journal entry to capitalize borrowing costs on inventory at year-end December 31. (If no entry is required for a transaction/event, select "No journal entry required" in the first account field. Do not round intermediate calculations.)
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