On March 1, Mocl Co. began construction of a small building. The following expenditures were incurred for construction: March 1 $ 225,000 April 1 $ 222,000 May 1, 540,000 June 1, 810,000 July 1, 300,000. The building was completed and occupied on July 1. To help pay for construction $150,000 was borrowed on March 1 on a 12%, three-year note payable. The only other debt outstanding during the year was a $1,500,000, 10% note issued two years ago.
Instructions
(a) Calculate the weighted-average accumulated expenditures.
(b) Calculate avoidable interest.