A company constructs a building for its own use. Construction began on January 1 and ended on December 30. The expenditures fo construction were as follows: January 1, $620,000; March 31, $720,000; June 30, $520,000; October 30, $960,000. The company arranged a 7% loan on January 1 for $940,000. Assume the $940,000 loan is not specifically tied to the construction of the building. The company's other borrowings, outstanding for the whole year, consisted of a $3 million loan and a $5 million note with interest rates of 8% and 6%, respectively. Assuming the company uses the weighted-average method, calculate the amount of interest capitalized for the year. (Do not round intermediate calculations. Round your percentage answer to 2 decimal places (i.e. 0.1234 should be entered as 12.34%).) January 1, 2021 March 31, 2021 June 30, 2021 30. 303 Date Expenditure $ 620,000 720,000 x 520,000x Weight 12/12 - 9/12 6/12 $ Average 620,000 540,000 260,000

Contract costing is about tracing particular costs related to a particular contract entered into with the customer. It is one of the forms of job order costing. It is useful in long-term contracts at the most. It is seen that substantial time is required…