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Ch 10 quiz - Use the following to answer questions1 3 On...

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Use the following to answer questions1 - 3: On March 1, 2010, Newton Company purchased land for an office site by paying $540,000 cash. Newton began construction on the office building on March 1. The following expenditures were incurred for construction: Date Expenditure s March 1, 2010 $ 360,000 April 1, 2010 504,000 May 1, 2010 900,000 June 1, 2010 1,440,000 The office was completed and ready for occupancy on July 1. To help pay for construction, $720,000 was borrowed on March 1, 2010 on a 9%, 3-year note payable. Other than the construction note, the only debt outstanding during 2010 was a $300,000, 12%, 6-year note payable dated January 1, 2010. 1. The weighted-average accumulated expenditures on the construction project during 2010 were A) $384,000. B) $2,934,000. C) $312,000. D) $696,000. 2. The actual interest cost incurred during 2010 was 3. Assume the weighted-average accumulated expenditures for the construction project are $870,000. The amount of interest cost to be capitalized during 2010 is 4. Insurance on equipment purchased, while the equipment is in transit, is part of the cost of the equipment.
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