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Compute capitalization rate used for interest capitalization

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Reference no: EM132984694

Problem 1: Zhang Ltd. (see No. 2) borrowed P1,000,000 on March 1 on a 5-year, 12% note to help finance construction of the building. In addition, the company had outstanding all year a 10%, 5-year, P2,000,000 note payable and an 11%, 4-year, P3,500,000 note payable. Compute the capitalization rate used for interest capitalization purposes.

Reference no: EM132984694

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