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What amount of interest should be capitalized as of october

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Herndon Inc. has a fiscal year ending October 31. On November 1, 2013, Herndon borrowed $20,000,000 at 15% to finance construction of a new plant. Repayments of the loan are to commence the month following completion of the plant. During the year ending October 31, 2014, expenditures for the partially completed structure totaled $12,000,000. These expenditures were incurred evenly through the year. Interest earned on the unexpended portion of the loan amounted to $800,000 for the year. What amount of interest should be capitalized as of October 31, 2014?

Reference no: EM13872400

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