Reference no: EM133062271

Question - Venetian, Inc. decided to open a new retail outlet in a neighboring town. On January 1, 2019, Venetian took out a $400,000 construction loan and purchased the land on January 15, 2019. Construction for the new store began on March 1, 2019. The company expected to complete construction in early 2020. Information about 2019 construction expenditures and details about Venetian's debt structure are included below.

Venetian Construction Expenditures-2019
Land purchase	Jan. 15, 2019	$200,000
Payment for excavation and foundation work	Mar. 31, 2019	50,000
Payment for framing, electrical, plumbing, etc.	June 30, 2019	350,000
Payment for drywall, fixtures, etc.	Dec. 31, 2019	150,000

 

Venetian Debt Structure-2019
Construction loan for retail building project	Jan. 1, 2019	$400,000	6%
Note payable	Mar. 31, 2018	350,000	8%
Bond payable	Oct. 31, 2018	250,000	10%

Required - What was the total weighted average accumulated expenditure for the Venetian project? What was the weighted average interest rate on general debt (non-project specific)?

A) $379,167; 8.83%

B) $404,167; 9.00%

C) $379,167: 7.70%

D) $550,000: 8.83%