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Note 3 - Interest | 6 Months Ended
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Apr. 30, 2021
Notes to Financial Statements |
Home Building Interest [Text Block] |
3. | Interest
Interest costs incurred, expensed and capitalized were:
|  | Three Months Ended |  |  | Six Months Ended |
|  | April 30, |  |  | April 30, |
(In thousands) |  | 2021 |  |  | 2020 |  |  | 2021 |  |  | 2020 |
Interest capitalized at beginning of period |  | $ | 65,327 |  |  | $ | 67,879 |  |  | $ | 65,010 |  |  | $ | 71,264 |
Plus interest incurred(1) |  |  | 41,870 |  |  |  | 45,323 |  |  |  | 83,327 |  |  |  | 89,657 |
Less cost of sales interest expensed |  |  | 21,725 |  |  |  | 18,589 |  |  |  | 38,890 |  |  |  | 36,725 |
Less other interest expensed(2)(3) |  |  | 22,033 |  |  |  | 26,869 |  |  |  | 46,008 |  |  |  | 51,872 |
Less interest contributed to unconsolidated joint venture(4) |  |  | 3,667 |  |  |  | - |  |  |  | 3,667 |  |  |  | 4,580 |
Interest capitalized at end of period(5) |  | $ | 59,772 |  |  | $ | 67,744 |  |  | $ | 59,772 |  |  | $ | 67,744 |
(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, which amounted to $17.5 million and $13.8 million for the three months ended April 30, 2021 and 2020, respectively, and $33.7 million and $28.7 million for the six months ended April 30, 2021 and 2020, respectively. Other interest also includes interest on completed homes, land in planning and fully developed lots without homes under construction, which does not qualify for capitalization and therefore is expensed. This component of other interest was $4.5 million and $13.1 million for the three months ended April 30, 2021 and 2020, respectively, and $12.3 million and $23.2 million for the six months ended April 30, 2021 and 2020, respectively.
(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 |  |  | Six Months Ended |
|  | April 30, |  |  | April 30, |
(In thousands) |  | 2021 |  |  | 2020 |  |  | 2021 |  |  | 2020 |
Other interest expensed |  | $ | 22,033 |  |  | $ | 26,869 |  |  | $ | 46,008 |  |  | $ | 51,872 |
Interest paid by our mortgage and finance subsidiaries |  |  | 527 |  |  |  | 509 |  |  |  | 952 |  |  |  | 1,279 |
Decrease (increase) in accrued interest |  |  | 14,720 |  |  |  | (5,553 | ) |  |  | 242 |  |  |  | (17,371 | )
Cash paid for interest, net of capitalized interest |  | $ | 37,280 |  |  | $ | 21,825 |  |  | $ | 47,202 |  |  | $ | 35,780 |
(4) | Represents capitalized interest which was included as part of the assets contributed to joint ventures, as discussed in Note 18. There was no impact to the Condensed Consolidated Statement of Operations as a result of these transactions.
(5) | Capitalized interest amounts are shown gross before allocating any portion of impairments, if any, to capitalized interest.

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- Definition Disclosure of the policy for capitalized homebuilding interest, including a rollforward of the balance from beginning of period to end of period. + References No definition available. + Details
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