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Compute for the capitalization rate applicable. On January 1, 20x1, ABC Co. had the following borrowings made for general purposes; a part of the

 

Compute for the capitalization rate applicable. On January 1, 20x1, ABC Co. had the following borrowings made for general purposes; a part of the proceeds was used to finance the construction of a qualifying asset: 12% short-term note 14% bank loan (3-year) 16% note payable (5-year) Principal P 10,000,000 18,000,000 22,000,000 The construction started on January 1 and was completed on December 20x1. The total cost of construction was P18,000,000, incurred evenly during the year.

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