Question 43

Sheffield Corp. is constructing a building. Construction began on January 1 and was completed on December 31. Expenditures were $6330000 on March 1, $5290000 on June 1, and $8250000 on December 31. Sheffield Corp. borrowed $3150000 on January 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 10%, 3-year, $6450000 note payable and an 11%, 4-year, $11950000 note payable. What is the avoidable interest for Sheffield Corp.?

$932954

$378000

$1225904

$432416