1. An entity capitalizes borrowing costs on the construction of property, plant, and equipment (PPE). On 1 July 2015, the entity purchased land for the construction of a new factory and borrowed £10 million at 9% annual interest on that date to finance the construction. Construction commenced on 1 August 2015, and the factory was complete and ready for use on 1 March 2016. Production started in the factory on 1 May 2016.
2. 
   
3. How much interest can be capitalised in PPE as a result of this construction in the year ended 30 June 2016?
4. Group of answer choices
5. 
   
6. £75,000
7. 
   
8. £525,000
9. 
   
10. £900,000
11. 
    
12. £750,000