In 2020, ABC Industries, Inc. constructed a new manufacturing facility at a cost of ₱12,000,000. The weighted-average accumulated expenditures for 2020 were calculated to be ₱5,400,000. The company had the following debt outstanding on December 31, 2020: • 10 percent, five-year note to finance the construction of the manufacturing facility, dated January 1, 2020, ₱3,600,00. • 12 percent, 20-year bonds issued at par on April 30, 2019, ₱8,400,000. • 8 percent, six-year note payable, dated March 1, 2019, ₱1,800,000. Determine the amount of interest to be capitalized by ABC Industries for 2020.
In 2020, ABC Industries, Inc. constructed a new manufacturing facility at a cost of ₱12,000,000. The weighted-average accumulated expenditures for 2020 were calculated to be ₱5,400,000. The company had the following debt outstanding on December 31, 2020: • 10 percent, five-year note to finance the construction of the manufacturing facility, dated January 1, 2020, ₱3,600,00. • 12 percent, 20-year bonds issued at par on April 30, 2019, ₱8,400,000. • 8 percent, six-year note payable, dated March 1, 2019, ₱1,800,000. Determine the amount of interest to be capitalized by ABC Industries for 2020.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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In 2020, ABC Industries, Inc. constructed a new manufacturing facility at a cost of ₱12,000,000. The weighted-average accumulated expenditures for 2020 were calculated to be ₱5,400,000. The company had the following debt outstanding on December 31, 2020: • 10 percent, five-year note to finance the construction of the manufacturing facility, dated January 1, 2020, ₱3,600,00. • 12 percent, 20-year bonds issued at par on April 30, 2019, ₱8,400,000. • 8 percent, six-year note payable, dated March 1, 2019, ₱1,800,000. Determine the amount of interest to be capitalized by ABC Industries for 2020.
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