The average accumulated expenditures for 2014 by the end of the construction period was:

Question

Quizplus · Accepted Answer

The average accumulated expenditures can be calculated by dividing the total accumulated expenditures by the number of months in the construction period. Total accumulated expenditures for the year 2014 can be calculated as $1,500,000 (accumulated expenditures at the end of June) + $2,250,000 (accumulated expenditures at the end of September) + $1,950,000 (accumulated expenditures at the end of December) = $5,700,000. The number of months in the construction period is 12. Therefore, the average accumulated expenditures for 2014 is $5,700,000/12 = $475,000 per month. Multiply this by the number of months in a year (12) and we get $5,700,000. However, we are looking for the average accumulated expenditures by the end of the construction period, so the answer is $1,500,000 (accumulated expenditures at the end of June) + $2,250,000 (accumulated expenditures at the end of September) + $1,950,000 (accumulated expenditures at the end of December) divided by 3 (since there are three endpoints). This equals $1,554,000.

The Average Accumulated Expenditures for 2014 by the End of the Construction