How muc capitalizable borrowing cost for magisterial company

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On January 1, 20x1, MAGISTERIAL AUTHORITATIVE Company had the following borrowings made for general purposes and a part of the proceeds was used to finance the construction of a qualifying asset.

Principal

12% short-term note ? 40,000,000

14% bank loan (3-year) 72,000,000

16% note payable (5-year) 88,000,000

Problem 1: The construction started on January 1 and was completed on December 20x1. The total cost of construction was ?72,000,000 which was incurred evenly during the year. How much is the capitalizable borrowing cost?

a. 28,960,000

b. 5,212,800

c. 5,362,428

d. 0

Reference no: EM132817677

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