Normal No Spac... Heading 1 Heading 2 Title Op Gram Paragraph Select Editing Styles Gramm ACCTG 331, Intermediate Accounting I Simulation #4: Long Term Assets Interest Capitalization (25 PTS) REQUIRED: Please complete the following simulation on asset acquisition problem. GRADE RUBRIC: The grading rubric will be similar to in-class exercise for this simulation. PARTICIPATION GRADE: Identify any members of your group who did not fully participate in the assignment. If someone did not fully participate, identify the student and assign either 0 or 50% to their effort. Their score will be reduced accordingly. SUBMISSION: Email your completed Doc file to the grader and me at chenyuan96726@gmail.com and jwang@sdsu.edu no later than the end of the due date (Nov. 19) Copy all team members on the email. In the subject line, please use "ACCTG 331 Simulation 1 section # and group #". List your team members in the body of the email and indicate the participation rate for each team member(0, 50%, 100%). Ulammarly Tell me what you want to do AaBbCc AaBbcc AaBb C AaBb Ccl Aab 1 Normal 1 No Spac... Heading 1 Heading 2 Title raph Styles SER On January 3, 2021. Michelson & Sons acquired a tract of land just outside the city limits. The land and existing building were purchased for $2.4 million. Michelson paid $400,000 and signed anoninterest-bearing note requiring the company to pay the remaining $2,000,000 on December 31, 2022. An interest rate of 7% properly reflects the time value of money for this type of loan agreement. Transfer taxes, title insurance, and other costs totaling $24,000 were paid at closing. During February, the old building was demolished at a cost of $120,000, and an additional $100,000 was paid to clear and grade the land. Construction of a new building began on March 1 and was completed on October 30. Construction expenditures were as follows: March 30 June 30 July 30 September 1 $ 800,000 1.200.000 1.200.000 600,000 Michelson did not borrow specifically for the construction project, but did have the following debt outstanding throughout 2021 $6,000,000, 8% long-term note payable $2,000,000, 5% long-term note payable In December, the company purchased equipment and office furniture and fixtures for a lump sum price of $800,000. The fair values of the equipment and the furniture and fixtures were $540,000 and $360,000, respectively. In December, Michelson paid $340,000 for the construction of parking lots and landscaping Required: 1. Determine the initial values of the various assets that Michelson acquired of constructed during 2021 a Land b. Land improvements c. Building d. Equipment e. Furniture and Fixtures 2. How much interest expense will Michelson report in its 2021 income statement? Normal No Spac... Heading 1 Heading 2 Title Op Gram Paragraph Select Editing Styles Gramm ACCTG 331, Intermediate Accounting I Simulation #4: Long Term Assets Interest Capitalization (25 PTS) REQUIRED: Please complete the following simulation on asset acquisition problem. GRADE RUBRIC: The grading rubric will be similar to in-class exercise for this simulation. PARTICIPATION GRADE: Identify any members of your group who did not fully participate in the assignment. If someone did not fully participate, identify the student and assign either 0 or 50% to their effort. Their score will be reduced accordingly. SUBMISSION: Email your completed Doc file to the grader and me at chenyuan96726@gmail.com and jwang@sdsu.edu no later than the end of the due date (Nov. 19) Copy all team members on the email. In the subject line, please use "ACCTG 331 Simulation 1 section # and group #". List your team members in the body of the email and indicate the participation rate for each team member(0, 50%, 100%). Ulammarly Tell me what you want to do AaBbCc AaBbcc AaBb C AaBb Ccl Aab 1 Normal 1 No Spac... Heading 1 Heading 2 Title raph Styles SER On January 3, 2021. Michelson & Sons acquired a tract of land just outside the city limits. The land and existing building were purchased for $2.4 million. Michelson paid $400,000 and signed anoninterest-bearing note requiring the company to pay the remaining $2,000,000 on December 31, 2022. An interest rate of 7% properly reflects the time value of money for this type of loan agreement. Transfer taxes, title insurance, and other costs totaling $24,000 were paid at closing. During February, the old building was demolished at a cost of $120,000, and an additional $100,000 was paid to clear and grade the land. Construction of a new building began on March 1 and was completed on October 30. Construction expenditures were as follows: March 30 June 30 July 30 September 1 $ 800,000 1.200.000 1.200.000 600,000 Michelson did not borrow specifically for the construction project, but did have the following debt outstanding throughout 2021 $6,000,000, 8% long-term note payable $2,000,000, 5% long-term note payable In December, the company purchased equipment and office furniture and fixtures for a lump sum price of $800,000. The fair values of the equipment and the furniture and fixtures were $540,000 and $360,000, respectively. In December, Michelson paid $340,000 for the construction of parking lots and landscaping Required: 1. Determine the initial values of the various assets that Michelson acquired of constructed during 2021 a Land b. Land improvements c. Building d. Equipment e. Furniture and Fixtures 2. How much interest expense will Michelson report in its 2021 income statement