Testbank Problem 139

During 2020, Debra Building Company constructed various assets at a total cost of $12,600,000. The weighted average accumulated expenditures on assets qualifying for capitalization of interest during 2020 were $8,729,000. The company had the following debt outstanding at December 31, 2020:

1.		10%, 5-year note to finance construction of various assets, dated January 1, 2020, with interest payable annually on January 1		$5,313,000
2.		12%, ten-year bonds issued at par on December 31, 2014, with interest payable annually on December 31		5,953,000
3.		9%, 3-year note payable, dated January 1, 2019, with interest payable annually on January 1		2,976,500

Compute the amounts of each of the following.

1.	Avoidable interest		$
2.	Total interest to be capitalized during 2020		$