ABC is engaged in the construction of an office building during 2020. Average excess expenditures for the office building for 2020 are $2,000,000.

The only borrowing of ABC for 2020 is a loan from from an unrelated lender of $1,000,000. The loan is nontraced debt and bears interest at an annual rate of 10 percent.

ABCs weighted average interest rate is 10 percent and interest incurred during 2020 is $100,000.

What is the amount of expenditure, and how much interest need to be capitalized?

Show the explanation and calculations.