Darell Plc obtained a loan for P2,5million with 15% interest on 1 September 2020 to erect a new warehouse. The warehouse construction commenced on 1 October 2020 and was completed on the 31 July 2021 .The construction did require all funds immediately, the Directors invested P0.5 million in 5.5% bonds from 1 September to January 2021.

Required

(a) Calculate the total borrowing costs that should be capitalized in respect to Darel's warehouse.

(b) According to IAS 8 define accounting policies and accounting estimates. You are also to distinguish between retrospective and prospective adjustments and briefly explain their implications to accounting and accounting estimates.