Forever company had the following loans outstanding as at 1 April 2017 Loan Loan l...
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Forever company had the following loans outstanding as at 1 April 2017 Loan Loan l at 10% 31 Dec 2018 $500,000 Loan 2 at 6% 31 Sep 2020 $300,000 Loan 3 at 8% 31 Mar 2019 $200,000 The effective interest rates of loans were equal to the coupon interest rates. The company spent the following amounts on construction of an item of PPE 1 Apr 2017 $400,000 1 Oct 2017 S300,000 1 Jan 2018 $100,000 As at Mar 2018 construction was in progress Find: a) the capitalization rate b) borrowing cost eligible for capitalization c) show the extracts from Income Statement for the year ended 31 Mar 2018 and Statement of Financial Position as at 31 Mar 2018
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