An entity incurred the following costs during the year.

An entity purchased land for P2,000,000 as a plant site. There was a small office building on the land with fair value of P700,000 which the entity will continue to use with some modifications and renovation. The entity decided to construct a factory building and incurred the following costs: Materials and supplies 3,000,000 Excavation 100,000 Labor on construction 2,500,000 Cost remodeling on office building 300,000 Legal cost of conveying land 50,000 Imputed interest on money used during construction 150,000 Cash discount on materials purchased 60,000 Supervision by management 70,000 Compensation insurance premium for workers 20,000 Clerical and other expenses related to construction 30,000 Paving of street and sidewalk 40,000 Plans and specifications 140,000 Payment for claim for injuries not covered by insurance 25,000 Legal cost of injury claims 15,000 Savings on construction 200,000