Sustainability Ltd Is a Property Development Company

Sustainability Ltd is a property development company.It commenced a new project at the beginning of the year and had spent $5 million on the project by the end of the year.This was the only project on hand during this period and all borrowings were specifically for this project.The interest cost on borrowings was at an annual rate of 15%.Total interest costs incurred for the year were $850 000.Sustainability Ltd should include as part of the costs of the project,borrowing costs of:

A) $375 000
B) $425 000
C) $850 000
D) $ Nil