On March 1, Blossom Co. began construction of a small building. The following expenditures were incurred for construction:
March 1 $301,200
April 1
267,600
May 1
789,600
June 1
1,185,600
July 1
402,000
The building was completed and occupied on July 1. To help pay for construction $191,000 was borrowed on March 1 on a 12%, three-
year note payable. The only other debt outstanding during the year was a $1,887,000, 10% note issued two years ago.
(a)
(b)
Calculate avoidable interest.
