On June 1, 2023, a company began construction of a new manufacturing plant. The plant...
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Accounting
On June 1, 2023, a company began construction of a new manufacturing plant. The plant was completed on October 31, 2024. Expenditures on the project were as follows ($ in millions):
| July 1, 2023 | 72 |
|---|---|
| October 1, 2023 | 40 |
| February 1, 2024 | 48 |
| April 1, 2024 | 30 |
| September 1, 2024 | 29 |
| October 1, 2024 | 15 |
On July 1, 2023, the company obtained a $97 million construction loan with a 10% interest rate. The loan was outstanding through the end of October, 2024. The company's only other interest-bearing debt was a long-term note for $100 million with an interest rate of 12%. This note was outstanding during all of 2023 and 2024. The company's fiscal year-end is December 31.
What is the amount of interest that should be capitalized in 2024, using the specific interest method?
Note: Round your answers to the nearest thousand.
Multiple Choice
$17,324,000
$17,359,000
$18,816,000
None of the other answer choices are correct.
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