Answer:
$500,000
Explanation:
Goodman Company
$600,000 × 4/12) + ($600,000 × 3/12) + ($600,000 × 2/12) + ($600,000 × 1/12)
=$200,000+$150,000+$100,000+$50,000
= $500,000
Therefore For the purpose of determining the amount of interest cost to be capitalized, the weighted-average accumulated expenditures on the building during 2017 were $500,000.
Answer:
Option A,$500,000 is correct as shown below.
Explanation:
In order to compute the accumulated expenditures on the building during 2017,the actual amount of expenditure incurred of $600,000 is weighted with with relevant months.
Since it took 5 months to complete the construction,applicable months are those months before it as shown thus;
4 months $600,000*4/12=$200,000
3 months $600,000*3/12=$150,000
2 months $600,000*2/12=$100,000
1 month $600,000*1/12=$50,000
The sum of weights=$200,000+$150,000+$100,000+$50,000=$500,000
Hence the correct option is $500,000,option A
