Under U.S. GAAP, a company may capitalize any interest costs associated with borrowings used in the self-construction of a business asset. Any capitalized interest is added to the cost basis of the asset and then depreciated over the expected useful life of the asset. Some investment professionals question the appropriateness of interest capitalization, observing that the interest costs associated with general corporate borrowings are expensed when paid and are not capitalized. These professionals allege that interest capitalization is a form of rear-end loading of expenses, and when material in amount, draws into question the quality of a firm’s reported earnings. Discuss the validity of these arguments.