Interest During Construction

Matrix Inc. borrowed $$1,000,000at8\%to$ finance the construction $of$ a new building for its own use. Construction began $on$ January $1,2019,$ and was completed $on$ October $31,2019.$ Expenditures related $to$ this building were:

January $1$$$252,000(includescostof$ purchasing land $of$ $$150,000)May1320,000$ July $1450,000$ October $31275,000$

$In$ addition, Matrix had additional debt $(unrelatedto$ the construction$)of$ $$500,000at9\%$ and $$800,000at10\%.$ All debt was outstanding for the entire year.

Required:

Compute the amount $of$ interest capitalized related $to$ the construction $of$ the building.

fill $in$ the blank $1$

$If$ the expenditures are assumed $to$ have been incurred evenly throughout the year:

Compute weighted average accumulated expenditures

$fill $in$ the blank $2$Interest During Construction

January $1$ $$252,000(includescostof$ purchasing land $of$ $$150,000)$

May $1,320,000$

July $1,450,000$

October $31275,000$

$In$ addition, Matrix had additional debt $(unrelatedto$ the construction$)of$ $$500,000at9\%$ and $$800,000at10\%.$ All debt was outstanding for the entire year.

Required:

Compute the amount $of$ interest capitalized related $to$ the construction $of$ the building.

$

$If$ the expenditures are assumed $to$ have been incurred evenly throughout the year:

Compute weighted average accumulated expenditures

$

Compute the amount $of$ interest capitalized $on$ the building

$

Compute the amount $of$ interest capitalized $on$ the building