Use the Following Information for Questions
on March 1

question 56

Multiple Choice

Use the following information for questions
On March 1, 2007, Dennis Company purchased land for an office site by paying $540,000 cash.Dennis began construction on the office building on March 1.The following expenditures were incurred for construction: $$\begin{array} { l r } \text { Date } & \text { Expenditures } \\\hline \text { March } 1,2007 & \$ 360,000 \\\text { April } 1,2007 & 504,000 \\\text { May 1, } 2007 & 900,000 \\\text { June } 1,2007 & 1,440,000\end{array}$$ The office was completed and ready for occupancy on July 1.To help pay for construction, $720,000 was borrowed on March 1, 2007 on a 9%, 3-year note payable.Other than the construction note, the only debt outstanding during 2007 was a $300,000, 12%, 6-year note payable dated January 1, 2007.
-The actual interest cost incurred during 2007 was

• A)$90,000.
• B)$100,800.
• C)$50,400.
• D)$84,000.

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Definitions:

Psychoanalytic Theory

A psychological framework originated by Sigmund Freud that emphasizes unconscious psychological processes (e.g., desires and fears) in shaping human behavior and personality.

Evolutionary Theory

A scientific theory explaining the process of natural selection and how it leads to complexity and diversity in the biological world.

Genetic Make-Up

The unique combination of genes inherited from both parents that determines the biological characteristics and traits of an individual.

Disposition

A person’s inherent qualities of mind and character.