Answer: $31,513.65
my monthly payment (principal) would be closest to $31,514
Explanation:
Using compound interest formula below to find the principal
A = p (1 + r/n)^nt
A= amount = $34,000
r = annual nominal rate = 1.9% = 0.019
n = number of compounding ; monthly compounding means 12 interest payments in a year
P= principal
t= time in years 48months = 48/12years = 4years
34,000 = p (1 + 0.019/12)^12(4)
34,000 = p (1 + 0.00158333333)^48
34,000 = p ( 1.00158333333)^48
34,000 = 1.07889755p
Divide both sides by 1.07889755
P = $31,513.6502
≈$31,514 to nearest whole number.
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Interest is capitalized when incurred in connection with the construction of plant assets because, during construction, the asset is not generating revenue
<h3>What is Interest?</h3>
This refers to the amount or rate that is added to a principal amount and this is usually done when a loan is collected.
Hence, we can see that when plant assets are being constructed, interest is capitalized and the main reason why this happens is that the asset is not generating revenue.
Furthermore, actual interest is the only thing that should be capitalized and this is because, during construction, the asset is not generating revenue and therefore companies should defer (capitalize) interest cost.
Thus, Interest is capitalized when incurred in connection with the construction of plant assets because, during construction, the asset is not generating revenue.
Read more about interest capitalization here:
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Answer:
The total amount of property, plant, and equipment that will appear on the balance sheet is $$1,950,000
Explanation:
The computation of the total amount of fixed assets are shown below:
= Land + Land (held for future use) + building + equipment + furniture - accumulated depreciation
= $100,000 + $800,000 + $800,000 + $450,000 + $100,000 - $300,000
= $1,950,000
The inventory is a current assets so it would not be included while computing the total value of the fixed assets.