The following situation is related to the activities and events of Superman Company in the...
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Accounting
The following situation is related to the activities and events of Superman Company in the year 2018. The financial year end for the company is 31 December.
In the past, the company expensed borrowing costs on construction of its factory. The company has changed its policy this year and now capitalizes as it is incurred. In 2017 accounts, borrowing costs expensed was $ 2,500,000 and this year's borrowing costs incurred was $ 3,800,000. The factory is still under construction.
Identify the type of accounting changes and discuss the proper accounting treatment.
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