Use the following information for questions.
On March 1, 2010, Newton Company purchased land for an office site by paying $540,000 cash.Newton 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, $720,000 was borrowed on March 1, 2010 on a 9%, 3-year note payable.Other than the construction note, the only debt outstanding during 2010 was a $300,000, 12%, 6-year note payable dated January 1, 2010.
-The weighted-average accumulated expenditures on the construction project during 2010 were

Question

Use the following information for questions.
On March 1, 2010, Newton Company purchased land for an office site by paying $540,000 cash.Newton 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, $720,000 was borrowed on March 1, 2010 on a 9%, 3-year note payable.Other than the construction note, the only debt outstanding during 2010 was a $300,000, 12%, 6-year note payable dated January 1, 2010.
-The weighted-average accumulated expenditures on the construction project during 2010 were

Quizplus · Accepted Answer

The weighted-average accumulated expenditures on the construction project during 2010 can be calculated as follows:

- Expenditures from March 1 to July 1 = $1,080,000
- Expenditures from July 1 to December 31 = $720,000

Weighted-average accumulated expenditures during 2010 = 
[(4 months x $1,080,000) + (8 months x $720,000)] / 12 = $696,000

Use the Following Information for Questions