Computing and Recording Interest Capitalization Weld Corporation is constructing a plant for its own use. Weld capitalizes interest on an annual basis. The following expenditures are made during the current year: January 1, $66,000; July 1, $638,000; September 1, $1,760,000; and December 31, $4,642,000. The following debts were outstanding throughout the current year. Debt Amount Construction note, 12% $220,000 Short-term note payable, 15% 880,000 Accounts payable (noninterest-bearing) 880,000 Note: Round all of your answers to the nearest whole number or whole percentage point. a. Compute the amount of interest to be capitalized during the year. Calculation of Actual Interest Debt Amount Interest rate Interest Amount Debt Specific Debt Construction loan $ 0 General Debt Note payable Total Actual Interest 0% $ 0 0% $ 0 0 0 Calculation of Weighted Average Accumulated Expenditures Weighted Avg. Expenditures Months outstanding Accum. Expenditures Date January 1 July 1 September 1 December 31 Weighted avg. accum. expenditures $ 0 0 $ 0 0 0 0 0 0 0 0 0 0 $ 0 Calculation of Avoidable Interest Debt Weighted Avg. Interest Category Accum. Expenditures Rate Avoidable Interest Specific Debt $ 0 0% $ 0 General Debt 0 0% $ 0 $ 0 0 Amount of interest to be capitalized during the year: $ 0 b. Calculate the amount of interest expense for the year. $ 0 c. Prepare the summary journal entry for the year to record the construction expenditures and interest, assuming that construction is not complete on December 31. Assume all payments are in cash. c. Prepare the summary journal entry for the year to record the construction expenditures and interest, assuming that construction is not complete on December 31. Assume all payments are in cash. Dec. 31 Account Name To record construction expenditures and interest. Dr. Cr. 0 0 0 0 0 0