Fred currently earns $9,500 per month. Fred has been offered the chance to transfer for three to five years to an overseas affiliate. His employer is willing to pay Fred $10,500 per month if he accepts the assignment. Assume that the maximum foreign-earned income exclusion for next year is $108,700. Problem 5-62 Part-a-2 (Algo) a-2. If Fred's employer also provides him free housing abroad (cost of $20,500), how much of the $20,500 is excludable from Fred's income? Answer is complete but not entirely correct. Amount to be excluded $ 3,860