On June 1, 2023, a company began construction of a new manufacturing plant. The plant was completed on October 31, 2024. Expenditures on the project were as follows ($ in millions): July 1, 2023 88 October 1, 2023 56 February 1, 2024 64 April 1, 2024 38 September 1, 2024 37 October 1, 2024 23 On July 1, 2023, the company obtained a $104 million construction loan with a 8% interest rate. The loan was outstanding through the end of October, 2024. The company's only other interest - bearing debt was a long-term note for $100 million with an interest rate of 10%. This note was outstanding during all of 2023 and 2024. The company's fiscal year end is December 31. What is the amount of interest that should be capitalized in 2023, using the specific interest method? Multiple Choice $4.59 million S 4.64 million $5.65 million None of the other answer choices are correct
On June 1, 2023, a company began construction of a new manufacturing plant. The plant was completed on October 31, 2024. Expenditures on the project were as follows ($ in millions): July 1, 2023 88 October 1, 2023 56 February 1, 2024 64 April 1, 2024 38 September 1, 2024 37 October 1, 2024 23 On July 1, 2023, the company obtained a $104 million construction loan with a 8% interest rate. The loan was outstanding through the end of October, 2024. The company's only other interest - bearing debt was a long-term note for $100 million with an interest rate of 10%. This note was outstanding during all of 2023 and 2024. The company's fiscal year end is December 31. What is the amount of interest that should be capitalized in 2023, using the specific interest method? Multiple Choice $4.59 million S 4.64 million $5.65 million None of the other answer choices are correct
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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On June 1, 2023, a company began construction of a new manufacturing plant. The plant was completed on October 31, 2024. Expenditures on the project were as follows ($ in millions): July 1, 2023 88 October 1, 2023 56 February 1, 2024 64 April 1, 2024 38 September 1, 2024 37 October 1, 2024 23 On July 1, 2023, the company obtained a $104 million construction loan with a 8% interest rate. The loan was outstanding through the end of October, 2024. The company's only other interest - bearing debt was a long-term note for $100 million with an interest rate of 10%. This note was outstanding during all of 2023 and 2024. The company's fiscal year end is December 31. What is the amount of interest that should be capitalized in 2023, using the specific interest method? Multiple Choice $4.59 million S 4.64 million $5.65 million None of the other answer choices are correct
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