CORRECT ANSWER NEEDED EMERGENCY---THANK YOU

On June 30, 20x6, the Iroquois Corporation, a publicly accountable entity began constructing an

asset. Construction continued through September 30, 20x7 when the asset was available for use.

Costs incurred in the construction of the asset are as follows:

June 30, 20x6 $300,000

October 31, 20x6 150,000

February 28, 20x7 150,000

April 30, 20x7 250,000

August 31, 20x7 420,000

Iroquois has a December 31 year-end. The companys general borrowing for the years ended

December 31, 20x6 and 20x7 are as follows:

Dec 31, 20x6 Dec 31, 20x7

Line of credit, 6% in 20x6 and 5.5% in 20x7 $10,000,000 $15,000,000

Bank Loan, 4% 20,000,000 16,000,000

Bonds payable, 5% 50,000,000 50,000,000

Required

Assuming that the asset is a qualifying asset for purposes of capitalization of borrowing costs,

calculate the total cost of the asset as at September 30, 20x7.

Note that you will first have to calculate the cost of the asset as at December 31, 20x6. The

balance at Dec 31, 20x6 (including any borrowing costs capitalized) then gets carried forward to

20x7 and becomes the opening balance at Jan 1, 20x7.