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Larkspur Company is constructing a building. Construction began on February 1 and was completed on December...

Larkspur Company is constructing a building. Construction began on February 1 and was completed on December 31. Expenditures were $1,920,000 on March 1, $1,200,000 on June 1, and $3,070,300 on December 31.

Larkspur Company borrowed $1,041,900 on March 1 on a 5-year, 13% note to help finance construction of the building. In addition, the company had outstanding all year a 10%, 5-year, $2,227,300 note payable and an 11%, 4-year, $3,799,000 note payable. Compute avoidable interest for Larkspur Company. Use the weighted-average interest rate for interest capitalization purposes

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ekkarill92 answered 2 years ago
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