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Sheffield Company is constructing a building. Construction began on February 1 and was completed on December 31. Expenditures were $4,320,000 on March 1, $2,880,000 on June 1, and $7,200,000 on December 31. Sheffield Company borrowed $2,400,000 on March 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 8%, 5-yea $4,800,000 note payable and an 11%, 4-year, $8,400,000 note payable. Compute avoidable interest for Sheffield Company. Use the weighted-average interest rate for interest capitalization purposes. (Round "Weighted-average interest rate" to 4 decimal places, e.g. 0.2152 and final answer to O decimal places, e.g. 5,275.) Avoidable interest Oriole Corporation purchased a truck by issuing an $112,000, 4-year, zero-interest-bearing note to Equinax Inc. The market rate of interest for obligations of this nature is 10%. Prepare the journal entry to record the purchase of this truck. (Round present value foctor calculations to 5 decimal places, e.g. 1.25124 and final answers to 0 decimal places, eg. 5,275. Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter O for the amounts.) Debit Credit Account Titles and Explanation

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