Il_-C.A104 (Capitalization of Interest) Vang Magazine Company started construction of a warehouse building for its own use at an estimated cost of 5,000,000 on January 1, 2014, and completed the building on December 31, 2014 (all amounts in thousands). During the construction period, Vang has the following debt obligations outstanding. Construction loan12% Interest. payable semlmnually, Ismael December 31, 2013 2,000,000 Short-tam loan10% Interest, payable monthly, and principal payable at maturity, on May 30, 2015 1,400,000 Lem-teen loan1 1 56 Interest, payable on January 1 of each year. Prmcipal payable on January 1, 2017 1,000,000 Total cost amounted to 5,200,000, and the weighted-average accumulated expenditures was 3,500,000. Jane Edo, the president of the company, has been shown the costs associated with this consiruction project and capitalized on the statement of financial position. She is bothered by the \"avoidable interest\" included in the cost. She argues that, first, all the interest is tulavoidableno one lends money without expecting to be compensated for it. Second, why can't the company use all the interest on all the loans when computing this avoidable interest? Finally, why can't her company capitalize all the annual interest that accrued over the period of construction