Question
Entity A has the following loan finance in place during the year: $2,560,000 of 7.50% loan finance $3,550,000 of 9.50% loan finance Entity A constructed
Entity A has the following loan finance in place during the year:
- $2,560,000 of 7.50% loan finance
- $3,550,000 of 9.50% loan finance
Entity A constructed a new factory which cost $5,655,000 and this was funded out of the existing loan finance.
The factory took 9 months to complete within the same reporting year.
REQUIRED:
Measure the borrowing costs should be capitalised.
ANSWER:
The borrowing costs should be capitalised is $
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Auditing And Assurance Services
Authors: Timothy Louwers, Penelope Bagley, Allen Blay, Jerry Strawser, Jay Thibodeau
8th International Edition
1260570517, 978-1260570519
