[vodrldnr]

Example from wiley

Assume the company is constructing an asset which qualifies for interest capitalization. by the begging of july $3000,000 had be spent on the asset and additional 800,000 was spent during july.

what is average accumulated expenditure for the month of july ??

my calculation is

1/1 year 1 ~ 6/30 year1 = 3,000,000 * (6/7) = 2,571,428
6/30 year 1 ~ 7/31 year 1 = 3,800,000* (1/7) = 542,857

add those two = 3,114,285

but wiley says the average accumulated expenditure is (3,000,000+3800000)/2 = 3,400,000

..

what am I doing wrong ???? is my calculation totally wrong ??

why is it 3400000!!!???

this accumulated expenditure ting makes me crazy !

It ain't About How Hard You Hit

[Anonymous]

The question is asking the one month of July; your calculation is based on seven months.

[Author]

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