Question
On January 1 of year 1, Arthur and Aretha Franklin purchased a home for $1.86 million by paying 260,000 down and borrowing the remaining $1.60
On January 1 of year 1, Arthur and Aretha Franklin purchased a home for $1.86 million by paying 260,000 down and borrowing the remaining $1.60 million with a 5 percent loan secured by the home. The Franklins paid interest only on the loan for year 1 and year 2 (unless stated otherwise). (Enter your answers in dollars and not in millions of dollars. Do not round intermediate calculations. Leave no answer blank. Enter zero if applicable.)
Problem 14-48 Part a
a. What is the amount of interest expense the Franklins may deduct in year 2 assuming year 1 is 2017?
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