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Business, 07.03.2020 04:26 melissapulido198

On January 1, 2016, the Shagri Company began construction on a new manufacturing facility for its own use. The building was completed in 2017. The only interest-bearing debt the company had outstanding during 2016 was long-term bonds with a book value of $10,000,000 and an effective interest rate of 8%. Construction expenditures incurred during 2016 were as follows:

January 1

$500,000

March 1

600,000

July 31

480,000

September 30

600,000

December 31

300,000

Required:

Calculate the amount of interest capitalized for 2016.

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