Tokelau Electronics Ltd is an international furniture manufacturer that sells its products in almost every country in the world. The company purchased a piece of land and began construction on a new manufacturing plant for its own use to meet increasing demands. The construction started on January 1, 2016. The building was completed on June 30, 2017 Expenditures on the project were as follows: January 1, 2016 $700,000 May 31, 2016 480,000 June 30, 2016 900,000 Sep 30, 2016 720,000 April 30, 2017 500,000 May 31, 2017 600,000 On January 1, 2016, the company borrowed a $600,000 construction loan with 10% interest rate. The company had other interest-bearing debts included a long-term bond of $5,000,000 with an 8% interest rate, and a long-term note of $2,000,000 with an interest rate of 5%. All debts were outstanding during all of 2016 and 2017. The company's fiscal year end is December 31. Required (support your answers with detailed calculations, round off all figures and interest rates in two decimal points) (a) Calculate the amount of interest that should be capitalized in 2016 and 2017 using the specific interest rate method. (16 marks) (b) What is the total cost of the plant? (4 marks) Part B Bulgaria Company exchanges an old delivery truck for a new delivery truck. At the date of exchange, the old delivery truck has a carrying amount of $45,000 and its fair market value is $11,000. Bulgaria paid cash $64,000 in the exchange. Show the detailed calculation to determine the profit or loss on exchange of the asset and the value of the new delivery truck to be recorded. Assuming the exchange has commercial substance. (5 marks) (Total 25 marks)