Problem 1-Interest Capitalization Cheshire Cat Company contracted with White Rabbit Construction to build a storage warehouse in 2017. Construction began on April 1st at which time Cheshire Cat paid S60,000. Cheshire Cat then made additional payments as follows, based upon progress made toward completion of the construction: June 1 September 1 December 1 December 31 $75,000 85,000 45,000 50,000 Cheshire Cat borrowed $100,000 specifically for this project at 8% interest. The company also had the following general purpose borrowings throughout the year: General Purpose Debt A: $1,000,000 at 8% General Purpose Debt B: $500,000 at 6% Assume that the building was completed on December 31, 2017. Required: (a) (b) (c) How much interest should be capitalized on this building? What amount would be in the building account at the time the building was completed? Suppose Cheshire Cat did not have a construction-specific borrowing. How much interest would be capitalized then