1. On January 2, 2020, Marigold Corp. began construction of a new citrus processing plant. The automated plant was finished and ready for use on
1.
On January 2, 2020, Marigold Corp. began construction of a new citrus processing plant. The automated plant was finished and ready for use on September 30, 2021. Expenditures for the construction were as follows:
January 2, 2020 | $ 592000 |
September 1, 2020 | 1812000 |
December 31, 2020 | 1812000 |
March 31, 2021 | 1812000 |
September 30, 2021 | 1194000 |
Marigold Corp. borrowed $3400000 on a construction loan at 12% interest on January 2, 2020. This loan was outstanding during the construction period. The company also had $12360000 in 9% bonds outstanding in 2020 and 2021. The interest capitalized for 2020 was:
$556200
$448480
$143520
$185400
2.
Sheffield Company issues $26400000, 8%, 5-year bonds dated January 1, 2020 on January 1, 2020. The bonds pay interest semiannually on June 30 and December 31. The bonds are issued to yield 7%. What are the proceeds from the bond issue?
ff | 3.5% | 4.0% | 7% | 8% |
Present value of a single sum for 5 periods | 0.84197 | 0.82193 | 0.71299 | 0.68058 |
Present value of a single sum for 10 periods | 0.70892 | 0.67556 | 0.50835 | 0.46319 |
Present value of an annuity for 5 periods | 4.51505 | 4.45182 | 4.10020 | 3.99271 |
Present value of an annuity for 10 periods | 8.31661 | 8.11090 | 7.02358 | 6.71008 |
$27486253
$27490323
$27497828
$26400000
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