Computing and Recording Interest Capitalization
The following information is from Bowin Inc. for a longterm construction project that is expected to be completed in January of next yearThe construction project is for a building intended for the company's own use. The capital expenditure on January of the current year is for the purchase of land for the building site. No new construction loans were opened for the project during the year. All debt was outstanding for the full year.
tableSapital Expanditures for Currant Year,DateActual ExpendituresJan$
Compute Interest to Capitalize and Expense
Journal Entry in Year
Journal Entries in Year
a Compute interest to be capitalized and interest to be expensed, during the year.
tableCalculation of Actual interestDebtDebt Amount,Interest rate,,tableInterestAmountSpecific DebtConstruction loan,onv,,
