Question
Negril Bay Construction Limited acquired a loan for $20 million on 1 January 2017 to begin the construction of a bridge. The loan was acquired
Negril Bay Construction Limited acquired a loan for $20 million on 1 January 2017 to begin the construction of a bridge. The loan was acquired from National Commercial Bank at an effective interest rate of 12%. Construction did not begin on the bridge until, 1 May 2017. The company invested $8m of the funds received from the bank over the period 1 February to 30 June 2017 at an interest rate of 8%. During the of July 2017 construction on the project was suspended.
REQUIRED: For the year ended 31 December 2017 show the following:
1. The Statement of Comprehensive Income Extract for the year
2. The Borrowing cost to be capitalized on the Statement of Financial Position
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