On January 1, 2016, BEAST CORP. started construction of a new office building. To finance construction, BEAST borrowed P 15,000,000 specifically for the construction of the building. Interest accruing on the loan is 10%. However, a part of the borrowing is used for working capital and other business needs during the year. Investment income earned on temporary investments of proceeds from the borrowing amounted to P 50,000 which was received in cash on October 1, 2016. Expenditures on the building amounted P 6,000,000 which was incurred evenly during the year. How much is the capitalizable borrowing cost of BEAST CORP.? A. P298, 750 C. P295,000 B. P300, 000 D. P1, 450, 000

On January 1, 2016, BEAST CORP. started construction of a new office building. To finance construction, BEAST borrowed P 15,000,000 specifically for the construction of the building. Interest accruing on the loan is 10%. However, a part of the borrowing is used for working capital and other business needs during the year. Investment income earned on temporary investments of proceeds from the borrowing amounted to P 50,000 which was received in cash on October 1, 2016. Expenditures on the building amounted P 6,000,000 which was incurred evenly during the year. How much is the capitalizable borrowing cost of BEAST CORP.? A. P298, 750 C. P295,000 B. P300, 000 D. P1, 450, 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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