On January 1, 2021, the Highlands Company began construction on a new manufacturing facility for its own use. The building was completed in 2022. The company borrowed $1,850,000 at 10% on January 1 to help finance the construction. In addition to the construction loan, Highlands had the following debt outstanding throughout 2021: $4,000,000, 14% bonds $1,000,000, 10% long-term note Construction expenditures incurred during 2021 were as follows: January 1 March 31 June 30 September 30 December 31 $ 800,000 1,400,000 1,040,000 800,000 600,000 Required: Calculate the amount of interest capitalized for 2021 using the specific interest method. (Do not round the intermediate Round your percentage answers to 1 decimal place (i.e. 0.123 should be entered as 12.3%).) Average $ Date January 1 March 31 June 30 September 30 December 31 Accumulated expenditure Expenditure $ 800,000 x 1,400,000 x 1,040,000 x 800,000 x 600.000 x $ 4,60 Weight 12/12 9/12 6/12 3/12 0/12 = = = = = 800,000 1,050,000 520,000 200,000 $ 2,570,000 Interest Rate Capitalized Interest Average accumulated expenditures Construction loan Other loans (not construction) Average $ 2,570,000 1,850,000 1001 $ 185,000 $ 185,000