Island Solutions started construction of a new office building for its own use at an estimated cost of $$5000000$ on January $1,2022,$ and completed the construction on December $31,2022.$

j$.$ During the year of construction $(2022)$ the company had outstanding debt obligations.

Specific Construction Debt:

$$200000012\%$ note issued December $31,2021.$ Interest payable semiannually

Other Debt:

$$140000010\%$ short$-$term loan. Interest payable monthly and principal payable at maturity on May $30,2023$

$$100000011\%$ long$-$term loan. Interest payable on January $1$ of each year and principal payable at maturity on January $1,2025$

B$.$ Total expenditures $-$ $$5200000$

C$.$ Weighted average accumulated expenditures $-$ $$3500000$

One of the accounting interns on the other team, having reviewed the statement of financial position, commented that it just did not make any sense... this $$avoidable interest$....$ In reality, isn$$t all interest unavoidable $....$ No one lends money without expecting to be compensated for it$.$

Compute the amount of interest to be capitalised. Provide detailed workings. Round to $2$ decimal places.

What was the capitalised cost of the new office building on the statement of financial position.