Question

Riverbed Company is constructing a building. Construction began on February 1 and was completed on December 31. Expenditures were $1,800,000 on March 1, $1,200,000 on June 1, and $3,010,680 on December 31. Compute Riverbed’s weighted-average accumulated expenditures for interest capitalization purposes. Weighted-Average Accumulated Expenditures?

Answer 1

Date	Amount	Capitalization Period	Weighted Avg Accumulated Exp
March-01	$1,800,000	10/12	$1,500,000
June-01	$1,200,000	7/12	$700,000
December-31	$3,010,680	0	$0
	$6,010,680		$2,200,000

Weighted Average Accumulated Expenditure = $2,200,000