Refer to Practice 10-6. Assume that construction was not completed on December 31 of Year 1. Also assume that the same loans were outstanding for all of Year 2. The following expenditure was made during Year 2:
July 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $500,000
Final construction was completed on December 31 of Year 2. Compute
(1) The amount of interest capitalized during Year 2 and
(2) The recorded cost of the building at the end of Year 2.