During 2022, Fleissner Industries constructed a specialized…
During 2022, Fleissner Industries constructed a specialized piece of equipment for use in their manufacturing facility. Construction began on January 1 and finished on December 31. Expenditures were $400,000 on February 1, $600,000 on June 1 and $500,000 on November 1. Fleissner Industries borrowed $1,000,000 on January 1 on a 3-year, 8% note to help finance construction of the equipment. In addition, the company had outstanding all year a 9%, 5-year, $6,000,000 note payable and a 6%, 4-year, $10,000,000 note payable. Calculate Fleissner’s avoidable interest: