Kingbird Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $$13,000,000$ on January $1,2025.$ Kingbird expected to complete the building by December $31,2025.$ Kingbird has the following debt obligations outstanding during the construction period.

Construction loan$-12\%$ interest, payable semiannually, issued December $31,2024$

$$5,200,000$

Short$-$term loan$-10\%$ interest, payable monthly, and principal payable at maturity on May $30,2026$

$3,900,000$

Long$-$term loan$-11\%$ interest, payable on January $1$ of each year; principal payable on January $1,2029$

$2,600,000$

$($a$)$

$$ Your answer is correct.

Assume that Kingbird completed the office and warehouse building on December $31,2025,$ as planned, at a total cost of $$13,520,000,$ and the weighted$-$average amount of accumulated expenditures was $$9,360,000.$ Compute the avoidable interest on this project. $($Use interest rates rounded to $2$ decimal places, e$.$g$.7\mathrm{.}58\%$ for computational purposes and round final answers to $0$ decimal places, e$.$g$.5,275.)$

Avoidable interest $

Attempts: $1$ of $3$ used

$($b$)$

Compute the depreciation expense for the year ended December $31,2026.$ Kingbird elected to depreciate the building on a straight$-$line basis and determined that the asset has a useful life of $30$ years and a salvage value of $$780,000.($Round answer to $0$ decimal places, e$.$g$.5,275.)$

Depreciation expense $