BrambleFurniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $8,000,000 on January 1, 2020. Bramble expected to complete the building by December 31, 2020. Bramble has the following debt obligations outstanding during the construction period. Construction loan-12% interest, payable semiannually, issued December 31, 2019 $3,200,000 Short-term loan-10% interest, payable monthly, and principal payable at maturity on May 30, 2021 2,240,000 Long-term loan-11% interest, payable on January 1 of each year. Principal payable on January 1, 2024 1,600,000 (a) Assume that Bramble completed the office and warehouse building on December 31, 2020, as planned at a total cost of $8,320,000, and the weighted-average amount of accumulated expenditures was $5,760,000. Compute the avoidable interest on this project

$650,752

Explanation:

The computation of the avoidable interest is shown below;

But before that following calculations must be done

Interest payable on short term loan

= $2,240,000 ×  10%

= $224,000

Interest payable on long term loan

= $1,600,000 × 11%

= $176,000

Therefore,

Weighted average interest rate is

= ($224,000 + $176,000) ÷ ($2,240,000 + $1,600,000) × 100

= 10.42%

Now

Avoidable interest is

= [$3,200,000 ×  12%] + [($5,760,000 - $3,200,000) × 10.42%]

= $650,752

typically a loft will include modern kitchen and bathrooms, this increases the price tag. lofts also have a good amount of open space, this requires more heating and electricity. lofts are also in older buildings, this means that maintaining the location increases the bill. keep in mind this is without talking about the high state and property taxes.

i hope this you! : )

answer; /// i believe the correct answer is first in, first out(fifo); //