[Problem 4] During 2019, New Building Company constructed a building at a total cost of...
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[Problem 4] During 2019, New Building Company constructed a building at a total cost of $9,100,000. The weighted average accumulated expenditures on the building qualifying for capitalization of interest during 2019 were $5,600,000 (Note: you need not calculate this $5,600,000 by yourself). The company had the following debt outstanding at December 31, 2019: 1. 10.5%, ten-year bonds issued at par on December 31, 2013, with interest payable annually on December 31 2. 12%, 3-year note payable, dated January 1, 2018, with interest payable annually on December 31 $4,000,000 2,000,000 3. 10%, 5-year note to finance construction of the building, dated January 1, 2019, with interest payable annually on December 31 3,400,000 (1) Compute the actual interest during 2019. (2) Compute the avoidable interest on construction. (3) Journalize the interest payment (only) including the interest to be capitalized during 2019. Suppose that all the interest was paid in cash on December 31, 2019
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