Q1. .(1.5 marks)

a. IFRS requires capitalizing actual interest (with modification). What items are to be considered for capitalization? Explain.

b.On November 1, 2010, Saif Company contracted Ahmed Construction Co. to construct a building for $1,600,000 on land costing $400,000 (purchased from the contractor and included in the first payment). Saif made the following payments to the construction company during 2011.