Use the following information for the next two questions:On January 1, 20x1, Entity A had the following general borrowings. A part of the proceeds wasused to finance the construction of a qualifying asset:PrincipalP1,000,00012% bank loan (1.5 years)10% bank loan (3-year)P8,000,000Expenditures made on the qualifying asset were as follows:Jan.1P 5,000,0004,000,000March 1August 31December 13,000,0002,000,000Construction was completed on December 31, 20x1..How much borrowing costs are capitalized to the cost of the constructed qualifying asset?

Borrowings costs are those costs which are defined as interest as well as other costs that are…

On January 1, 20x1, Entity A had the following general borrowings. A part of the proceeds used to finance the construction of a qualifying asset: Principal 12% bank loan (1.5 years) 10% bank loan (3-year) P1,000,000 P8,000,000 Expenditures made on the qualifying asset were as follows: Jan.1 P 5,000,000 March 1 4,000,000 August 31 December 1 3,000,000 2.000.000

On January 1, 20x1, Entity A had the following general borrowings. A part of the proceeds used to finance the construction of a qualifying asset: Principal 12% bank loan (1.5 years) 10% bank loan (3-year) P1,000,000 P8,000,000 Expenditures made on the qualifying asset were as follows: Jan.1 P 5,000,000 March 1 4,000,000 August 31 December 1 3,000,000 2.000.000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Subject : Accounting
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