Carlson Company Began Constructing a Building for Its Own Use

question 89

Essay

Carlson Company began constructing a building for its own use in January 2012.During 2012,Carlson incurred interest of $75,000 on specific construction debt and $16,750 on other borrowings.Interest computed on the weighted-average amount of accumulated expenditures for the building during 2012 as $55,000
Required:
What amount of interest should Carlson capitalize?

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Definitions:

Carbon Dioxide

A colorless, odorless gas produced by burning carbon and organic compounds and by respiration. It is naturally present in air and is absorbed by plants in photosynthesis.

Terrestrial Plants

Terrestrial plants are species that grow on land rather than in water, adapting to a variety of habitats from forests to deserts.

Aquifer

Rock layers that contain water and release it in appreciable quantities to wells or springs.

Rate Of Recharge

The speed at which an aquifer or a rechargeable battery regains its capacity or is refilled after use.