question archive On January 1, 2018, Jingle Corp contracts with Reindeer Corp to construct a building for $220,000
On January 1, 2018, Jingle Corp contracts with Reindeer Corp to construct a building for $220,000
Subject:AccountingPrice: Bought3
On January 1, 2018, Jingle Corp contracts with Reindeer Corp to construct a building for $220,000. Jingle Corp makes several payments to Reindeer Corp during 2018. Jingle Corp financed the construction of the building with debt. The total debt of Jingle Corp and the cash payments made by Jingle Corp for the building are below. Assume that all interest is paid in cash on December 31. Specific Construction Debt 8%, 2-year note to finance the construction of the building, dated $100,000 January 1, 2018, with interest payable annually on December 31. Other Debt 3.55%, 10-year note payable, dated December 31, 2015, with $50,000 interest payable annually on December 31. 5.55%, 20-year note payable, dated December 31, 2009, with $500,000 interest payable annually on December 31. Amount Expenditures Date March 1, 2018 June 1, 2018 September 1, 2018 December 31, 2018 $123,000 $45,000 $20,000 $32,000 Required: Use the above information to answer the following questions. (a) What is the weighted average of accumulated expenditures? (b) What is the avoidable interest for the building in 2018?
