You are the accountant of Betta Limited (BL). BL has commenced construction of a manufacturing plant to
Question:
You are the accountant of Betta Limited (BL). BL has commenced construction of a manufacturing plant to expand its production line, which will take two years to complete. The cost of the plant will be financed through a new loan specifically obtained for this purpose. Remaining cost will be financed through the existing borrowings. You have pointed out that a portion of borrowing costs needs to be capitalised in the cost of plant. The management is interested in determining the estimated borrowing costs that will be capitalised in the future and has requested you to prepare a working.
Required: List the information (key dates, amounts, etc.) that you will need to gather in order to calculate the estimated borrowing costs to be capitalised.
Managerial Accounting
ISBN: 978-1259307416
16th edition
Authors: Ray Garrison, Eric Noreen, Peter Brewer