On March 1, Imhoff Co. began construction of a small building. Payments of $400,000 were made monthly for four months beginning March 1. The building was completed and ready for occupancy on June 1. In determining the amount of interest cost to be capitalized, the weighted-average accumulated expenditures are

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The weighted-average accumulated expenditures are calculated by considering the amount of money spent and the duration it has been invested in the construction. Since payments of $400,000 were made monthly for four months, but the project was completed in three months, the calculation would consider the time-weighted value of these payments. For March, April, and May, the expenditures would be considered for 3, 2, and 1 month(s), respectively, leading to a weighted-average calculation of $200,000. This is because the first payment has been invested for three months, the second for two months, and the third for one month, with the last payment not contributing to the weighted average as the project was completed by then.