Question: A company constructs a building for its own use. Construction began on Jan 1. and ended on Dec. 30. The expenditures for construction were as

  1. A company constructs a building for its own use. Construction began on Jan 1. and ended on Dec. 30. The expenditures for construction were as follows:

Construction Expenditures

1-Jan 210,000

31-Mar 360,000

30-Jun 470,000

31-Oct 510,000

The company arranged a 5% construction loan on Jan 1 for $660,000. The company also had a $5,000,000, 6.4% note outstanding the whole year

The company uses a specific interest method to capitalize interest. Calculate the total cost of the building, including the capitalized interest.

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