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Calculate the avoidable interest

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Reference no: EM132531957

Question - A corporation makes the following expenditures related to the construction of a plant asset

1/1/19 $200,000

4/1/19 $400,000

7/1/19 $300,000

12/31/19 350,000

The corporation has a construction loan of $900,000 (5%annual interest rate). The loan was outstanding for the entire year of 2019. There is no other debt outstanding. The interest qualifies for interest capitalization. Calculate the avoidable interest.

Reference no: EM132531957

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