Question

Waterway Industries is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $6400000 on March 1, $5250000 on June 1, and $8650000 on December 31. Waterway Industries borrowed $3200000 on January 1 on a 5-year, 11% note to help finance construction of the building. In addition, the company had outstanding all year a 9%, 3-year, $6440000 note payable and an 10%, 4-year, $12550000 note payable.

Required:
What are the weighted-average accumulated expenditures?

Answer 1

Answer:

$8,395,833

Explanation:

Calculation to determine What are the weighted-average accumulated expenditures

Weighted-average accumulated expenditures

=($6,400,000 × 10/12) + ($5,250,000 × 7/12) + ($8,650,000 × 0/12)

Weighted-average accumulated expenditures=$5,333,333+$3,062,500+0

Weighted-average accumulated expenditures=$8,395,833

Therefore the weighted-average accumulated expenditures will be $8,395,833