SAVE YOUR WORK BECAUSE YOU WILL USE THIS INFORMATION FOR MULTIPLE QUESTIONS.

Lady X makes the expenditures listed below on the dates listed below for a self-constructed asset. She takes out a $700,000 loan for this project at 8 percent. She also has a 2,000,000 loan at 4 percent and a 1,000,000 loan at 7 percent.

She has the following expenditures:

720,000 on May 1, 2020

600,000 on September 1, 2020

500,000 on February 1, 2021

Construction ends September 30, 2021

How much depreciation expense does Lady X recognize in 2021 related to this asset? (HINT: Asset does not depreciate until construction is completed). The asset has a 30 year useful life and a 100,000 residual value. Knope uses straight line depreciation. Round to the nearest dollar.