1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
3241004551 [841]
2 years ago
6

Thornton Industries began construction of a warehouse on July 1, 2018. The project was completed on March 31, 2019. No new loans

were required to fund construction. Thornton does have the following two interest-bearing liabilities that were outstanding throughout the construction period: $6,000,000, 8% note $9,000,000, 3% bonds Construction expenditures incurred were as follows: July 1, 2018 $ 580,000 September 30, 2018 870,000 November 30, 2018 870,000 January 30, 2019 810,000 The company’s fiscal year-end is December 31. Required: Calculate the amount of interest capitalized for 2018 and 2019.
Business
1 answer:
Nina [5.8K]2 years ago
6 0

Answer:

interest capitalized during 2018 = $29,000

interest capitalized during 2019 = $14,000

Explanation:

current outstanding liabilities:

$6,000,000, 8% note

$9,000,000, 3% bonds

construction related expenditures:

July 1, 2018 $580,000

September 30, 2018 $870,000

November 30, 2018 $870,000

January 30, 2019 $810,000

interest capitalized for 2018:

July 1, 2018 $580,000 x 6/12 = $290,000

September 30, 2018 $870,000 x 3/12 = $217,500

November 30, 2018 $870,000 x 1/12 = $72,500

total weighted accumulated expenditures = $580,000

weighted interest rate:

$6/$15 x 8% = 3.2%

$9/$15 x 3% = 1.8%

total weighted interest = 5%

interest capitalized during 2018 = $580,000 x 5% = $29,000

interest capitalized for 2018:

January 1, 2019 $580,000 x 3/12 = $145,000

January 30, 2019 $810,000 x 2/12 = $135,000

total weighted accumulated expenditures = $280,000

interest capitalized during 2019 = $280,000 x 5% = $14,000

You might be interested in
Many economists are critical of the minimum wage because they believe that it: A. hurts the efforts of labor unions.B. reduces t
Alex73 [517]

Answer and Explanation:

B. reduces the number of available job opportunities

8 0
3 years ago
Rankings as well as word of mouth from satisfied customers drive additional sales for automotive companies. However, because thi
Novay_Z [31]

Answer:

a. sales orientation

Explanation:

The sales orientation is a business model that focused to make the best product and the services without knowing the customer needs and wants

Therefore as per the given situation, it is mentioned that there is a lack of understanding with respect to the customer wants and need

So this represents the sales orientation

hence, the correct option is a.

3 0
2 years ago
When country music star miranda lambert delivered a message that endorsed milk when she appeared in an ad that is part of "the b
Semmy [17]

Answer:

A direct source

Explanation:

8 0
3 years ago
Stock Y has a beta of 1.3 and an expected return of 15.3 percent. Stock Z has a beta of 0.70 and an expected return of 9.3 perce
zmey [24]

Answer:

Reward-to-risk ratio Y =7.54%

Reward-to-risk ratio Z = 5.43%

Since the SML reward-to-risk is 6.8%

Stock Y is Undervalued

Stock Z Overvalued

Explanation:

Calculation for the reward-to-risk ratios for stocks Y is 7.54% and Z is 5.43% respectively.

Reward-to-risk ratio Y = (15.3%-5.5%)/1.3

Reward-to-risk ratio Y =7.54%

Reward-to-risk ratio Z = (9.3%-5.5%)/0.7 =

Reward-to-risk ratio Z = 5.43%

Therefore the reward-to-risk ratios for stocks Y and Z are and percent, respectively

Since the SML reward-to-risk is 6.8%

Stock Y is undervalued while Stock Stock Z on the other hand is overvalued reason been that

Reward-to-risk ratio Y is high while the Reward-to-risk ratio is low .

5 0
3 years ago
The shape of your utility function implies that you are a individual, and, therefore, you accept the wager because the differenc
Blababa [14]

Answer:

The first and third statements are correct. These statements are:

The utility function of a risk-averse person exhibits the law of diminishing marginal utility.

The more wealth that risk-averse people have, the less satisfaction they receive from an additional dollar.

Explanation:

A risk-averse individual is the one who tends to avoid taking risks. In other words, such an individual prefers lower returns with known risks as opposed to higher returns with unknown risks.

The utility curve for a risk-averse individual is concave in shape. This implies diminishing marginal utility, that is, the satisfaction derived from each additional dollar gained is less than that derived from the previous dollar. Therefore, the first and third statements are both correct.

The second statement is false because risk-averse individuals do not over-estimate the probability of losing money. The fourth statement is also false because risk-averse individuals receive less satisfaction from each additional dollar, not more.

3 0
3 years ago
Other questions:
  • Firms such as IKEA and The Home Depot are known for their use of __________ because they set reasonably low prices but still off
    7·2 answers
  • Elly owns a small coffee shop. She has only one employee. One weekend, she decided to take a break from work. She is wondering w
    13·1 answer
  • Cindy goes to the lumber yard to buy lumber for a deck that she is building. She tells the salesperson at the lumber yard that s
    15·1 answer
  • Organizational change can best be defined as​ ________.
    6·1 answer
  • Fitbit makes health and fitness tracking devices. some buyers want very basic fitness tracking such as steps taken and calories
    5·1 answer
  • What do many economists blame for the severity of the great depression?
    10·1 answer
  • During May, Carolan Corporation transferred $59,000 from Work in Process to Finished Goods and recorded a Cost of Goods Sold of
    12·1 answer
  • The following information about the payroll for the week ended December 30 was obtained from the records of Boltz Co.:Salaries:
    14·1 answer
  • If you had to pay for your “wants” on your own, how does that affect your ability to acquire them?
    14·1 answer
  • Which device deployment model gives businesses significant control over device security while allowing employees to use their de
    15·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!