Situation I On January 1, 2020, Cullumber, Inc. signed a fixed-price contract to have Builder Associates construct a major plant facility at a cost of $ 4,491,000. It was estimated that it would take 3 years to complete the project. Also on January 1, 2020, to finance the construction cost, Cullumber borrowed $ 4,491,000 payable in 10 annual installments of $ 449,100, plus interest at the rate of 10%. During 2020, Cullumber made deposit and progress payments totaling $ 1,684,125 under the contract; the weighted-average amount of accumulated expenditures was $ 898,200 for the year. The excess borrowed funds were invested in short-term securities, from which Cullumber realized investment income of $ 261,100. What amount should Cullumber report as capitalized interest at December 31, 2020?

Capitalized interest

$

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(b)

Situation II During 2020, Riverbed Corporation constructed and manufactured certain assets and incurred the following interest costs in connection with those activities.

		Interest Costs Incurred
Warehouse constructed for Riverbeds own use		$ 31,110
Special-order machine for sale to unrelated customer, produced according to customers specifications		9,640
Inventories routinely manufactured, produced on a repetitive basis		8,640

All of these assets required an extended period of time for completion. Assuming the effect of interest capitalization is material, what is the total amount of interest costs to be capitalized?

The total amount of interest costs to be capitalized

$

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