Interest During Construction

Alta Company is constructing a production complex that qualifies for interest capitalization. The following information is available:

Capitalization period: January $1,$ Year $1,$ to June $30,$ Year $2$

Expenditures on project:

Year $1$:

Year $2$:

Amounts borrowed and outstanding:

$$1\mathrm{.}7$ million borrowed at $10\%,$ specifically for the project

$$6$ million borrowed on January $1,$ Year $1,$ at $12\%$

$$10$ million borrowed on January $1,$ Year $1,$ at $6\%$

Required:

Note: Round all final numeric answers to two decimal places.

Compute the amount of interest costs capitalized each year.

Capitalized interest, Year $1$

Capitalized interest, Year $2$

If it is assumed that the production complex has an estimated life of $25$ years and a residual value of $$0,$ compute the straight$-$line depreciation in $2.$