What is the weighted-average interest rate

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Question - Arlington Company is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $4,000,000 on March 1, $3,300,000 on June 1, and $5,000,000 on December 31. Arlington Company borrowed $2,000,000 on January 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 10%, 3-year, $4,000,000 note payable and an 11%, 4-year, $7,500,000 note payable. What is the weighted-average interest rate used for interest capitalization purposes?

A) 10.65%

B) 10.5%

C) 10.85%

D) 11%

Reference no: EM131795458

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