On December 31, 2019, Sarasota Inc. borrowed $3,960,000 at 13% payable annually to finance the...
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Accounting
On December 31, 2019, Sarasota Inc. borrowed $3,960,000 at 13% payable annually to finance the construction of a new building. In 2020, the company made the following expenditures related to this building: March 1, $475,200; June 1, $792,000; July 1, $1,980,000; December 1, $1,980,000. The building was completed in February 2021. Additional information is provided as follows.
1.
Other debt outstanding
10-year, 14% bond, December 31, 2013, interest payable annually
$5,280,000
6-year, 11% note, dated December 31, 2017, interest payable annually
$2,112,000
2.
March 1, 2020, expenditure included land costs of $198,000
3.
Interest revenue earned in 2020
$64,680
(a)
New attempt is in progress. Some of the new entries may impact the last attempt grading.Your answer is incorrect.
Determine the amount of interest to be capitalized in 2020 in relation to the construction of the building.
The amount of interest
$
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