harshsoccer2495 harshsoccer2495

25-03-2021
Business

contestada

On January 1, 2021, Desert Company announced their intent to build a new headquarters building. Construction began on February 1st. On March 1st, Desert took out a loan from Cactus Capital for $500,000 at 8% interest over 3 years and at that time made their first expenditure. Construction was complete on December 1st. What is the date on which they can begin capitalizing interest costs? Group of answer choices

Respuesta :

anthougo anthougo

27-03-2021

Answer:

Desert Company

The date on which Desert Company can begin capitalizing interest costs is March 1, 2021.

Explanation:

This is the date it obtained the construction loan for 3 years. Desert should only capitalize interest during the construction period. This is the period when the asset is being prepared for its future use. Interest can only be capitalized when the related asset will yield future economic benefits. Otherwise, it should be expensed.

Answer Link

Otras preguntas

which branch of central government makes/enact/ passes laws

Mrs. Bell's class is selling Hobbs Middle Jaguar t-shirts to raise money for a trip. They typically sell 400 t-shirts a year for $10 per shirt. Mrs bell knows t

What does 28 tens equal to

What is the most common cause of liver failure ?

Cardiac muscle contracts A. in response to voluntary output B in response to nonvoluntary input C. on its own without input

the most important benefit a dificult amendment process is that it

If luisa travel 5 miles west then 8 miles south then 2.5 miles west how far is she from where she started?

What educational level, age and econimic status of the audience do I reach when talking bout geriatric offices

what mass of iron 3 chloride contain 2.35 x 10 to the 23rd chloride ions

(Does this represent a linear function) (3,6)(0,2)(3,5)