3. Capitalization of interest (15 points).

On March 1 2020, Mocl Co. began construction of a building. The following expenditures were incurred for construction:

March 1, 2020	$300,000
June 1, 2020	296,000
July 1, 2020	720,000
January 1, 2021	1,080,000
February 28, 2021	400,000

The building was completed and occupied on March 1, 2021. To help pay for construction, $1,000,000 was borrowed on March 1, 2020 on a 12%, three-year note payable. The only other debt outstanding during the year was a $2,000,000, 10% note issued two years ago.

1. Calculate the weighted-average accumulated expenditures (10 points).

weighted-average accumulated expenditures		$

2. Calculate avoidable interest (5 points).

Avoidable Interest		$