On January 1, 2021, Firm ABC began constructing a new warehouse. The warehouse was finished...
90.2K
Verified Solution
Link Copied!
Question
Accounting
On January 1, 2021, Firm ABC began constructing a new warehouse. The warehouse was finished and ready for use on December 31, 2021. Expenditures on the project were as follows:
| Date of Expenditure | Expenditure Amount |
| January 1, 2021 | $ 205,000 |
| October 1, 2021 | $ 360,000 |
To finance the project, Firm ABC took out a $350,000 construction loan with a stated interest rate of 7%. The construction loan was outstanding throughout the construction period. In addition, Firm ABC had $50,000 in bonds payable with a stated interest rate of 4% outstanding during 2021.
The amount of interest capitalized for 2021 was:
| a. | $22,855 | |
| b. | $24,500 | |
| c. | $19,705 | |
| d. | $20,650 |
Get Answers to Unlimited Questions
Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!
Membership Benefits:
- Unlimited Question Access with detailed Answers
- Zin AI - 3 Million Words
- 10 Dall-E 3 Images
- 20 Plot Generations
- Conversation with Dialogue Memory
- No Ads, Ever!
- Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Other questions asked by students
StudyZin's Question Purchase
1 Answer
$0.99
(Save $1 )
One time Pay
- No Ads
- Answer to 1 Question
- Get free Zin AI - 50 Thousand Words per Month
Unlimited
$4.99*
(Save $5 )
Billed Monthly
- No Ads
- Answers to Unlimited Questions
- Get free Zin AI - 3 Million Words per Month
*First month only
Free
$0
- Get this answer for free!
- Sign up now to unlock the answer instantly
You can see the logs in the Dashboard.