What amount of borrowing costs should be capitalized as cost of the asset? *a. P 360,000b. P 310,000c. P 328,750d. P 327,500 Entity A, government entity, started the construction of an asset on Jan 1, 2021with a loan of Php4,000,000 borrowed at an interest rate of 9% per annum.The loan was used on the asset as follows:Jan 11,500,000May 12,000,000Oct 1500,000The construction of the asset was completed on 31 December 2021.However, during the accounting period Entity A has invested thesurplus funds at an interest rate of 3% on temporary basis beforethese were required for spending. How much borrowing costs are capitalized to the cost of theconstructed qualifying asset?

Borrowing cost means where the assets like building , take substantial time to build , then interest…

Answered: What amount of borrowing costs should…

What amount of borrowing costs should be capitalized as cost of the asset? * a. P 360,000 b. P 310,000 c. P 328,750 d. P 327,500

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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