A company constructs a building for its own use. Construction began on January 1 and ended on December 30. The expenditures for construction were as follows: January 1, $500,000; March 31, $600,000; June 30, $400,000; October 30, $600,000. To help finance construction, the company arranged a 7% construction loan on January 1 for $700,000. The companys other borrowings, outstanding for the whole year, consisted of a $3 million loan and a $5 million note with interest rates of 8% and 6%, respectively.

Only need anwser for Other loans (not construction)

Assuming the company uses the specific interest method, calculate the amount of interest capitalized for the year. (Do not round intermediate calculations. Round your percentage answers to 2 decimal places (i.e. 0.1234 should be entered as 12.34%).) Weight Expenditure Date Average 500,000 X 12/12 500,000 January 1 600,000 X 9/12 450,000 March 31 6/12 200,000 June 30 400,000 600,000 x 212 October 30 100,000 S 2,100,000 S 1,250,000 Accumulated expenditures Capitalized Average Interest Rate Interest Average accumulated 1,250,000 expenditures 49,000 7.00 700,000 Construction loan 0 Other loans (not construction) 49,000