On March 1, 2010, Newton Company purchased land for an office site by paying $540,000 cash. Newton began construction on the office building on March 1. The following expenditures were incurred for construction:

Date Expenditures

March 1, 2010 $ 360,000

April 1, 2010 504,000

May 1, 2010 900,000

June 1, 2010 1,440,000

The office was completed and ready for occupancy on July 1. To help pay for construction, $720,000 was borrowed on March 1, 2010 on a 9%, 3-year note payable. Other than the construction note, the only debt outstanding during 2010 was a $300,000, 12%, 6-year note payable dated January 1, 2010.

78. The weighted-average accumulated expenditures on the construction project during 2010 were

a. $384,000.

b. $2,934,000.

c. $312,000.

d. $696,000.

79. The actual interest cost incurred during 2010 was

a. $90,000.

b. $100,800.

c. $50,400.

d. $84,000.

80. Assume the weighted-average accumulated expenditures for the construction project are $870,000. The amount of interest cost to be capitalized during 2010 is

a. $78,300.

b. $82,800.

c. $90,000.

d. $100,800.

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