Compute for the capitalization rate applicable. On January 1, 20x1, ABC Co. had the following borrowings...
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Compute for the capitalization rate applicable. On January 1, 20x1, ABC Co. had the following borrowings made for general purposes; a part of the proceeds was used to finance the construction of a qualifying asset: 12% short-term note 14% bank loan (3-year) 16% note payable (5-year) Principal P 10,000,000 18,000,000 22,000,000 The construction started on January 1 and was completed on December 20x1. The total cost of construction was P18,000,000, incurred evenly during the year. Compute for the capitalization rate applicable. On January 1, 20x1, ABC Co. had the following borrowings made for general purposes; a part of the proceeds was used to finance the construction of a qualifying asset: 12% short-term note 14% bank loan (3-year) 16% note payable (5-year) Principal P 10,000,000 18,000,000 22,000,000 The construction started on January 1 and was completed on December 20x1. The total cost of construction was P18,000,000, incurred evenly during the year.
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To compute the capitalization rate applicable for ABC Co we need to calculate the weighted average c... View the full answer
Related Book For
Financial Reporting Financial Statement Analysis and Valuation a strategic perspective
ISBN: 978-1337614689
9th edition
Authors: James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
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