On January 1, 2018, the Mason Manufacturing Company began construction of a building to be used as its office headquarters. The building was completed on September 30, 2019.

Expenditures on the project were as follows:

January 1, 2018 $1,280,000

March 1, 2018 720,000

June 30, 2018 920,000

October 1, 2018 720,000

January 31, 2019 288,000

April 30, 2019 621,000

August 31, 2019 918,000

On January 1, 2016, the company obtained a $3,200,000 construction loan with a 15% interest rate. The

loan was outstanding all of 2018 and 2019. The company's other interest-bearing debt included two long- term notes of $3,000,000 and $7,000,000 with interest rates of 11% and 13%, respectively. Both notes were outstanding during all of 2018 and 2019. Interest is paid annually on all debt. The company's fiscal year- end is December 31.

Required:

1)Calculate the amount of interest that Mason should capitalize in 2016 and 2017 using the specific

interest method.

2)What is the total cost of the building?

3)Calculate the amount of interest expense that will appear in the 2016 and 2017 income statements.

4)Repeat requirements 1) to 3) using the weighted-average method