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problem: The third year of a construction project began with a $30,000 balance in Construction in Progress. Included in that figure is $6,000 of interest capitalized in the first two years. Construction expenditures during the third year were $80,000 which were incurred evenly throughout the entire year. The company has had over $300,000 in interest-bearing debt outstanding the third year, at a weighted average rate of 9 percent. How much interest for the third year is capitalized?

a) $3,600

b) $6,300

c) $9,360

d) $9,900

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Accounting Basics, Accounting

Category:- Accounting Basics
Reference No.:- M981235

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