E2-Capitalization of interest. On March 1, Mocl Co. began construction of a small building. The...
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E2-Capitalization of interest. On March 1, Mocl Co. began construction of a small building. The following expenditures were incurred for construction: March 1 May 1 July 1 $ 300,000 720,000 400,000 April 1 296,000 June 1 1,080,000 The building was completed and occupied on July 1. To help pay for construction $200,000 was borrowed on March 1 on a 12%, three-year note payable. The only other debt outstanding during the year was a $2,000,000, 10% note issued two years ago. Instructions (a) Calculate the weighted-average accumulated expenditures. (b) Calculate avoidable interest, and total interests. (C) Determine the total interests that should be capitalized. (d) Prepare the JE to account for the interest payment for the year
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