In the context of constructing a plant asset, the interest that the company would not have paid if it had not borrowed funds to construct the asset is referred to as ________.
A) avoidable interest
B) marginal interest
C) capital interest
D) financing interest

Question

Quizplus · Accepted Answer

Avoidable interest is the interest cost that a company could have avoided if it had not borrowed funds specifically for the construction of a plant asset.

In the Context of Constructing a Plant Asset, the Interest