Bagwell Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $2,500,000 on January 1, 2014. Bagwell expected to complete the building by December 31, 2014. Bagwell has the following debt obligations outstanding during the construction period. Construction Loan - 15% interest, payable semiannually, issued December 31, 2013: $1,000,000Short-term loan- 10% Interest, payable monthly, and principal Payable at maturity on May 30, 2015: 700,000Long-term loan - 11% interest, payable on January 1 of each year. Principal payable on January 1, 2018: $500,000a. Assume that Bagwell completed the office and warehouse building on December 31, 2014, as planned at a total cost of $2,600,000, and the weighted average of accumulated expenditures was $1,800,000. Compute the avoidable interest on this project. b. Prepare the journal entry to record the capitalization of interest and the recognition of interest expense, if any at December 31, 2014.c. Compute the depreciation expense for the year ended December 31, 2015. Bagwell elected to depreciate the building on a straight-line basis and determined that the asset has a useful life of 30 years and a salvage value of $150,000.