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Note 3 - Interest

6 Months Ended

Apr. 30, 2015

3.	Interest

Interest costs incurred, expensed and capitalized were:

	Three Months Ended April 30,		Six Months Ended April 30,
(In thousands)	2015	2014	2015	2014

Interest capitalized at beginning of period	$114,241	$107,089	$109,158	$105,093
Plus interest incurred (1)	40,703	36,782	82,175	71,601
Less cost of sales interest expensed	12,013	12,407	23,331	21,897
Less other interest expensed (2)(3)	23,030	23,472	48,101	46,805
Interest capitalized at end of period (4)	$119,901	$107,992	$119,901	$107,992

(1)	Data does not include interest incurred by our mortgage and finance subsidiaries.

(2)

Other interest expensed includes interest that does not qualify for interest capitalization because our assets that qualify for interest capitalization (inventory under development) do not exceed our debt. Also includes interest on completed homes and land in planning, which does not qualify for capitalization, and therefore, is expensed.

(3)	Cash paid for interest, net of capitalized interest, is the sum of other interest expensed, as defined above, and interest paid by our mortgage and finance subsidiaries adjusted for the change in accrued interest on notes payable, which is calculated as follows:

	Three Months Ended April 30,				Six Months Ended April 30,
(In thousands)	2015		2014		2015		2014
Other interest expensed	$23,030		$23,472		$48,101		$46,805
Interest paid by our mortgage and finance subsidiaries	268		409		676		1,145
Increase in accrued interest	(8,726	)	(5,295	)	(7,716	)	(4,011	)
Cash paid for interest, net of capitalized interest	$14,572		$18,586		$41,061		$43,939

(4)	Capitalized interest amounts are shown gross before allocating any portion of impairments, if any, to capitalized interest.