Whats the amount of interest that refract should capitalize

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Reference no: EM133328357

Case: On June 1, 2017, the Refract Company began construction of a new manufacturing plant. The plant was completed on October 31, 2018. Expenditures on the project were as follows:

July 1, 2017 54M

Oct 1, 2017 22M

February 1, 2018 30M

April 1, 2018 21M

September 1, 2018 20M

October 1, 2018 6M

On July 1, 2017 Refract obtained a $70M construction loan with a 6% interest rate. The loan was outstanding through the end of October, 2018. The company's only other interest bearing debt was a long-term note for $100M with an interest rate of 8%. The note was outstanding during all of 2017 and 2018. The conmpany's fiscal year-end is December 31.

Question: What's the amount of interest that Refract should capitalize in 2017, using the specific interest method.?

Reference no: EM133328357

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