8chapter10 - be capitalized or expensed as incurred 4 If a company purchases land with an existing building on it with the intention of tearing

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YOUR NAME YOUR PERM NUMBER ECON 136A Your class Time QUIZ/ HOMEWORK #8 CHAPTER 10 NOTE: Use any piece of paper. You only need to write the question number followed by your answer. A brief and concise answer is appropriate for each question. 1) In order to capitalize interest in connection with self-constructing a building, the company must: (3 items which must be true in order to capitalize interest, list all three) 2) If a Company halts construction of a self constructed asset, can they continue to capitalize interest while no construction activities are taking place? 3) Should the cost of a repair necessary to maintain a fixed asset in its present condition
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Unformatted text preview: be capitalized or expensed as incurred? 4) If a company purchases land with an existing building on it with the intention of tearing down that building to build a new one, should the cost of demolition be capitalized? 5) A Company paid $1 million for land in 2004 for construction of a new office building. They begin construction on February 1, 2005. They made the following expenditures in connection with the construction of the office during 2005: Date Paid Amount 2/1/2005 10,000 $ 5/1/2005 25,000 $ 8/1/2005 100,000 $ 11/30/2005 250,000 $ Compute the weighted average accumulated expenditures in connection with interest capitalization computation....
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This note was uploaded on 08/06/2008 for the course ECON 136A taught by Professor Anderson during the Winter '08 term at UCSB.

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