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The following information is provided for Rodgers Inc. for a long-term construction project that is expected to be completed in the second quarter of 2021.
The following information is provided for Rodgers Inc. for a long-term construction project that is expected to be completed in the second quarter of 2021. The project is an addition to an existing stadium, which is a qualifying asset. The company borrowed $800,000 at 12% on January 1, 2020 to help finance the construction. Capital Expenditures for 2020 Date Amount Jan. 1, 2020 $1,200,000 Mar. 31, 2020 300,000 June 30, 2020 500,000 Dec. 31, 2020 500,000 Outstanding Debt in 2020 Debt Issuance Date Debt Amount Interest Rate Construction loan 1-Jan-201 $800,000 12% Note payable 1-Mar-19 600,000 8% Bond payable 1-Jan-15 150,000 10% Assume that Rodgers Inc. applies the weighted average method to capitalize interest. Required: 1. The weighted average accumulated expenditures (AAE) for 2020 is $ Round to the nearest dollar. 2. The amount of interest that actually incurred in 2020 is $ Round to the nearest dollar, 3. The amount of interest to be capitalized in 2020 is $ Round to the nearest dollar. 4. The amount of interest to be expensed in 2020 is $ Round to the nearest dollar
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