Use the Following Information for Questions

question 46

Multiple Choice

Use the following information for questions
On March 1, 2010, Beck Company purchased land for an office site by paying $270,000 cash.Beck began construction on the office building on March 1.The following expenditures were incurred for construction:

The office was completed and ready for occupancy on July 1.To help pay for construction,
$360,000 was borrowed on March 1, 2010 on a nine percent, three-year note payable.Other than the construction note, the only debt outstanding during 2010 was a $150,000, 10%, six-year note
payable dated January 1, 2010.
-The actual interest cost incurred during 2010 was

• A)$45,000.
• B)$50,400.
• C)$25,200.
• D)$42,000.

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Definitions:

Milligrams

A unit of mass equal to one thousandth of a gram, used in measuring small quantities of mass.

Yards

A unit of measurement equal to 3 feet or 0.9144 meters, used primarily in the United States, the United Kingdom, and Canada for measuring distances.

Centimeters

A measurement in the metric system that corresponds to one hundredth of a meter in length.

Yards

A unit of length in the Imperial and US customary systems, equal to 3 feet or 0.9144 meters.