On January 1, 2022, Buffalo Outfitters signed a fixed-price contract to have Builder Associates construct...
60.1K
Verified Solution
Link Copied!
Question
Accounting
On January 1, 2022, Buffalo Outfitters signed a fixed-price contract to have Builder Associates construct a major plant facility at a cost of R$4,080,000. It was estimated that it would take 3 years to complete the project. Also on January 1, 2022, to finance the construction cost, Buffalo borrowed R$4,080,000 payable in 10 annual installments of R$408,000, plus interest at the rate of 10%. During 2022, Buffalo made deposit and progress payments totaling R$1,530,000 under the contract. The excess borrowed funds were invested in short-term securities, from which Buffalo realized investment income of R$51,000. What amount should Buffalo report as capitalized borrowing cost at December 31, 2022?
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.