On december 31 2013 jumble inc borrowed 1000000 at 10

Reference no: EM13391679

On December 31, 2013, Jumble Inc. borrowed $1,000,000 at 10% payable annually to finance the construction of a new building. In 2014, the company made the following expenditures related to this building: June 1, $400,000; July 1, $600,000; September 1, $1,200,000; December 1, $600,000. The building was completed in April 2015. Additional information is provided as follows.

1. Other debt outstanding

10-year, 8% bond, dated December 31, 2012, interest payable annually $10,000,000

15-year, 10% note, dated December 31, 2009, interest payable annually $2,500,000

2. Interest revenue earned in 2014 $6,000

Instructions

(a) Determine the amount of interest to be capitalized in 2014 in relation to the construction of the building.

(b) Prepare the journal entry to record the capitalization of interest and the recognition of interest expense, if any, at December 31, 2014.

Reference no: EM13391679

Questions Cloud

Competitors did not follow increase which non-collusive : in march 2002 american airlines implicitly increased the price for low-priced business tickets. competitors did not

Describe the objectives for week three how do they relate : discuss the objectives for week three. how do they relate to the practice of accounting and its uses in business?

Browse the internet to acquire a copy of the most recent : browse the internet to acquire a copy of the most recent annual report for publicly traded company.examine the

The current liability section of the balance sheet lists : the current liability section of the balance sheet lists the liabilities that are due within the next 12 months.

On december 31 2013 jumble inc borrowed 1000000 at 10 : on december 31 2013 jumble inc. borrowed 1000000 at 10 payable annually to finance the construction of a new building.

This case study primarily deals with tata tearsquos : instructionsanswer the following questionsthis examination accounts for 60 of the course assessment. you are permitted

Would consumers benefit more from the tariff or quota on : would consumers benefit more from a tariff or a quota on imports? provide one 1 supporting fact to support your

Compute the capacity of each machine center and the : beck manufacturing al beck president of beck manufacturing wants to determine the capacity of his facility which

Explain the economic outcome of the single-price monopoly : imagine that it is the year 2199. technology has progressed at an incredible pace. the latest discovery is the

User Account

All Pages