Question

Arlington Company is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $4,000,000 on March 1, $3,300,000 on June 1, and $5,000,000 on December 31. Arlington Company borrowed $2,000,000 on January 1 on a 5- year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 10%, 3-year, $4,000,000 note payable and an 11%, 4-year, $7,500,000 note payable. 96. What are the weighted-average accumulated expenditures

Answer 1

Answer:

$5,258,333

Explanation:

Arlington Company weighted-average accumulated expenditures

March 1 Expenditure $3,333,333

($4,000,000 ×10/12)

Add June 1 Expenditure $1,925,000

($3,300,000 ×7/12)

Add Dec 31 Expenditure $0

($5,000,000 ×0/12)

Weighted-average accumulated expenditures $5,258,333

($3,333,333+$1,925,000)