Question: On January 1, 2016, Dreamworld Co. began construction of a new warehouse. The building was finished and ready for use on September 30, 2017. Expenditures on the project were as follows:
January 1, 2016 $321,000
September 1, 2016 $471,000
December 31, 2016 $471,000
March 31, 2017 $471,000
September 30, 2017 $321,000
Dreamworld had $5,700,000 in 10% bonds outstanding through both years.
Dreamworld's capitalized interest in 2016 was:
a. $47,800.
b. $64,200.
c. $55,825.
d. $32,100.