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How much should be shown as capitalized interest on faith

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Problem 1: Faith, Inc. has a fiscal year ending April 30. On May 1, 2018, Faith borrowed P10,000,000 at 15% to finance construction of its own building. Repayments of the loan are to commence on the month following completion of the building. During the year ended, April 30, 2019, expenditures for the partially completed structure totaled P6,000,000. These expenditures were incurred evenly throughout the year. Interest earned on the unexpended portion of the loan amount to P400,000 for the year. How much should be shown as capitalized interest on Faith's financial statements at April 30, 2019?

Reference no: EM132765789

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