During the current calendar year, ABC Company started constructing a building to use as a warehouse. The
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Question:
During the current calendar year, ABC Company started constructing a building to use as a warehouse. The project was completed and ready for inventory storage at the end of the current year. ABC Company incurred the following expenses related to the construction: January 1, $150,000; July 1, $500,000; and December 31, $750,000. ABC Company had a $1,500,000, 9% note payable outstanding during the year to fund this project among other things. What amount of interest should ABC Company capitalize for the year?
a.$135,000
b.$36,000
c.$126,000
d.$58,500
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