11 NANGUTANG started constructing a building for its own use on January 1, 2020. NANGUTANG provided the following information related to the construction: Outstanding loans of the Company at January 1, 2020: Interest Rate Amount of loan Interest Cost 5% P10,000,000 P 500,000 10% 20,000,000 2,000,000 Total P30,000,000 P2,500,000 Construction expenditures: July 1, 2020 7,000,000 November 31,2020 3,000,000 December 31, 2020 1,000,000 The amount of borrowing cost that should be charged to profit or loss for the period is? Group of answer choices 340,142 312,375 2,208,450 2,187,625
11 NANGUTANG started constructing a building for its own use on January 1, 2020. NANGUTANG provided the following information related to the construction: Outstanding loans of the Company at January 1, 2020: Interest Rate Amount of loan Interest Cost 5% P10,000,000 P 500,000 10% 20,000,000 2,000,000 Total P30,000,000 P2,500,000 Construction expenditures: July 1, 2020 7,000,000 November 31,2020 3,000,000 December 31, 2020 1,000,000 The amount of borrowing cost that should be charged to profit or loss for the period is? Group of answer choices 340,142 312,375 2,208,450 2,187,625
Chapter9: Acquisitions Of Property
Section: Chapter Questions
Problem 45P
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Question
11
NANGUTANG started constructing a building for its own use on January 1, 2020. NANGUTANG provided the following information related to the construction:
Outstanding loans of the Company at January 1, 2020:
|
Interest Rate |
Amount of loan |
Interest Cost |
|
5% |
P10,000,000 |
P 500,000 |
|
10% |
20,000,000 |
2,000,000 |
|
Total |
P30,000,000 |
P2,500,000 |
Construction expenditures:
|
July 1, 2020 |
7,000,000 |
|
November 31,2020 |
3,000,000 |
|
December 31, 2020 |
1,000,000 |
The amount of borrowing cost that should be charged to profit or loss for the period is?
Group of answer choices
340,142
312,375
2,208,450
2,187,625
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