On January 1, 2021, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2022. Expenditures on the project were as follows:

On January 1, 2021, the company obtained a $4,400,000 construction loan with a 14% interest rate. The loan was outstanding all of 2021 and 2022. The company’s other interest-bearing debt included two long-term notes of $2,000,000 and $8,000,000 with interest rates of 10% and 12%, respectively. Both notes were outstanding during all of 2021 and 2022. Interest is paid annually on all debt. The company’s fiscal year-end is December 31.

Required:
1. Calculate the amount of interest that Mason should capitalize in 2021 and 2022 using the specific interest method.
2. What is the total cost of the building?
3. Calculate the amount of interest expense that will appear in the 2021 and 2022 income statements.

On July 31, 2017, Coronado Company engaged Minsk Tooling Company to construct a special-purpose piece of factory machinery. Construction was begun immediately and was completed on November 1, 2017. To help finance construction, on July 31 Coronado issued a $303,600, 3-year, 12% note payable at Netherlands National Bank, on which interest is payable each July 31. $208,600 of the proceeds of the note was paid to Minsk on July 31. The remainder of the proceeds was temporarily invested in short-term marketable securities (trading securities) at 10% until November 1. On November 1, Coronado made a final $95,000 payment to Minsk. Other than the note to Netherlands, Coronado’s only outstanding liability at December 31, 2017, is a $28,200, 8%, 6-year note payable, dated January 1, 2014, on which interest is payable each December 31.

Collapse question part

(a)

Calculate the interest revenue, weighted-average accumulated expenditures, avoidable interest, and total interest cost to be capitalized during 2017.

Interest revenue

$

Weighted-average accumulated expenditures

$

Avoidable interest

$

Interest capitalized

$

Construction Safety

1. CEO of a residential roofing business: “This fall protection standard is ridiculous. I can’t afford to buy lifelines for all of my employees. Besides, they work faster without lifelines.” OSHA inspector: “The lifelines won’t cost you nearly as much as an injured employee who falls off a roof and breaks his neck.” What is your opinion of OSHA’s fall protection standard? Should residential contractors be exempted?

2. You are a recent college graduate, and this is your first real job. You are the assistant director of safety for Rayster Construction, Inc. (RCI). Your job today is to conduct preoperation inspections of the company’s two cranes that are being used to construct a bridge across a small bay. As you begin your first inspection, the crane operator—who has worked for RCI for 25 years—brushes past you and starts the crane’s engine. He says, “Get out of the way, kid. This crane is just fine. It doesn’t need inspecting. You are holding up my work.” This crane operator has an excellent safety record, as does RCI in general. How should you handle this situation?

1)The stress on the circular footing of 6 m diameter due to column load is 200 kPa at the level of the footing i.e., z = 0 m. Calculate the vertical stress at a depth of 2 m, 4 m and 6 m below the central line of the footing and at edge of the footing. Also, draw the pressure bulb for 10% intensity of the applied in conventional graph sheet .

2)There are two borrowing areas ‘A’ and ‘B’ which have soils with void ratios of 0.8 and 0.7 respectively. The inplace water content is 20% and 15% respectively. The fill at the end of the construction will have a total volume of 10,000 m3, bulk density of 2000 kg/m3 and a placement water content of 22%. Determine the volume of soil required to be excavated from both areas. Assume that the specific gravity of the soils at site ‘A’ and site ‘B’ is 2.65 If the cost of excavation of soil and its transportation from the borrow area to the construction site is Rs 200 per every 100 m3 of soil for Area A and Rs 220 per every 100 m3 of soil for area B, which of the borrow area is more economical and justify your answer with detailed calculations

On January 1, 2018, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2019. Expenditures on the project were as follows: January 1, 2018 $ 1,310,000 March 1, 2018 1,020,000 June 30, 2018 1,220,000 October 1, 2018 1,020,000 January 31, 2019 333,000 April 30, 2019 666,000 August 31, 2019 963,000 On January 1, 2018, the company obtained a $3,700,000 construction loan with a 12% interest rate. The loan was outstanding all of 2018 and 2019. The company’s other interest-bearing debt included two long-term notes of $3,000,000 and $7,000,000 with interest rates of 8% and 10%, respectively. Both notes were outstanding during all of 2018 and 2019. Interest is paid annually on all debt. The company’s fiscal year-end is December 31. Required: 1. Calculate the amount of interest that Mason should capitalize in 2018 and 2019 using the specific interest method. 2. What is the total cost of the building? 3. Calculate the amount of interest expense that will appear in the 2018 and 2019 income statements.

On January 1, 2018, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2019. Expenditures on the project were as follows: January 1, 2018 $ 1,310,000 March 1, 2018 1,020,000 June 30, 2018 1,220,000 October 1, 2018 1,020,000 January 31, 2019 333,000 April 30, 2019 666,000 August 31, 2019 963,000 On January 1, 2018, the company obtained a $3,700,000 construction loan with a 12% interest rate. The loan was outstanding all of 2018 and 2019. The company’s other interest-bearing debt included two long-term notes of $3,000,000 and $7,000,000 with interest rates of 8% and 10%, respectively. Both notes were outstanding during all of 2018 and 2019. Interest is paid annually on all debt. The company’s fiscal year-end is December 31. Required: 1. Calculate the amount of interest that Mason should capitalize in 2018 and 2019 using the specific interest method. 2. What is the total cost of the building? 3. Calculate the amount of interest expense that will appear in the 2018 and 2019 income statements.

Receivables Investment McEwan Industries sells on terms of 3/10, net 30. Total sales for the year are $1,921,000; 40% of the customers pay on the 10th day and take discounts, while the other 60% pay, on average, 70 days after their purchases. What is the days sales outstanding? .40 * 10 + .60 * 70 4 + 42 days days sales outstanding = 46 days What is the average amount of receivables? 1,921,000*46/365 $242,098.63 What is the percentage cost of trade credit to customers who take the discount? .03*365 / .97x20 56.44% What is the percentage cost of trade credit to customers who do not take the discount and pay in 70 days? .03*365 / .97x60 18.8% What would happen to McEwan’s accounts receivable if it toughened up on its collection policy with the result that all nondiscount customers paid on the 30th day?

The Hallmark shop chain buys 3400 boxes of holiday greeting cards directly from the manufacturer. The list price o the cards is $9.90 per box, there is a trade discount of 30/10/20, and a cash discount of 5/10-40x . The Hallmark Shop earns and receives both discounts. The cards were sold as follows: 1080 boxes at $7.90, 1250 boxes at $5.90, 660 boxes at $5.00, 230 boxes at $4.00 and the remaining boxes were unsaleable. To better manage greeting card sales next year, determine each of the following:

a) the net cost of the greeting card after trade and cash discounts

b) the total sales amount received from all the holiday greeting cards

c) The amount of net profit from the sales of the cards

d) The markup as a percentage

e) The equivalent percent of markup on cost to the nearest whole percentage

Martin Company is considering the introduction of a new product. To determine a selling price, the company has gathered the following information: Number of units to be produced and sold each year 19,000 Unit product cost $ 50 Projected annual selling and administrative expenses $ 72,000 Estimated investment required by the company $ 340,000 Desired return on investment (ROI) 19 % The company uses the absorption costing approach to cost-plus pricing. Required: 1. Compute the markup required to achieve the desired ROI. (Round your Required ROI answers to the nearest whole percentage (i.e, 0.1234 should be entered as 12). Round your "Markup Percentage" answers to 2 decimal places (i.e., 0.1234 should be entered as 12.34.)) 2. Compute the selling price per unit. (Round your intermediate and final answers to 2 decimal places. )

New Co. has a DOL of 1.5.   They predicted sales of 10,000 units, but it may be more like 12,000 units.  If the OCF at the expected level is $1,000,000, what would you expect OCF to be at the higher level?

1. $1,200,000
2.    1,300,000
3.       700,000
4.    1,500,000
5.   None of the above.

1. If the initial investment in a six year project is $400,000 and the IRR is 18%, what is the annual income?

1. $114,364
2.      66,667
3.    108,206
4.    150,015
5.      83,500

1. In using the MACRS depreciation method:

1. Each percentage is divided by the cost of the asset.
2. Year three is always where the huge tax savings occurs.
3. The sum of the percentages does not always add up to 100%.
4. Each percentage is multiplied by the cost of the asset
5. Book value is important in the computation of depreciation.

2. XYZ Co.’s sales are $250,000, costs are $130,000, depreciation is $25,000 and the tax rate is 21%.  What is operating cash flow?

1. $100,050
2.     94,800
3.   145,000
4.    19,950
5.    None of the above