Capitalization of Borrowing Costs During 2014, Tibet Building Company Constructed

Essay

Capitalization of borrowing costs During 2014, Tibet Building Company constructed various assets at a total cost of $4.2 million. The weighted-average accumulated expenditures on assets qualifying for capitalization of interest during 2014 were $2.8 million.The company had the following debts outstanding at December 31, 2014: Instructions Calculate the amounts of the following for 2014 (show calculations):
a)avoidable interest,
b)total interest to be capitalized.