d Ahmed Limited has the following loans outstanding as at 1st January 2020: $000 7% Loan...
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d Ahmed Limited has the following loans outstanding as at 1st January 2020: $000 7% Loan notes 55,000,000 110,000,000 85,000,000 150,000,000 8% Loan notes 12% Debentures 10% Bank Loan Ahmed limited started construction of a new housing complex. The cost of construction will be $100,000,000. Ahmed will use the amounts from the above loans. Construction ended on August 31,2020. Work was ceased from March 1, 2020 to April 30, 2020 due to labour strikes. The housing complex will be available for usage on December 31, 2020. Required: Calculate the borrowing cost eligible for capitalization as per IAS 23. Also show the cost of the housing complex as at December 31, 2020. Babel Limited is researching and developing refined processes for manufacturing. During 2020, expenditure incurred was $100,000. $90,000 of this expense was incurred before 1st December 2020 and $10,000 between 1" December 2020 and 31 December 2020. Babel can demonstrate that, at 1 December 2020, the production process met the criteria for recognition as an intangible asset. The recoverable amount of the expertise of the process estimated to be $50,000. Required: How should the expense be treated in the financial statements of Babel as at December 31, 2020 as per the provision of IAS 38 Answers must clearly demonstrate the understanding of the said LAS d Ahmed Limited has the following loans outstanding as at 1st January 2020: $000 7% Loan notes 55,000,000 110,000,000 85,000,000 150,000,000 8% Loan notes 12% Debentures 10% Bank Loan Ahmed limited started construction of a new housing complex. The cost of construction will be $100,000,000. Ahmed will use the amounts from the above loans. Construction ended on August 31,2020. Work was ceased from March 1, 2020 to April 30, 2020 due to labour strikes. The housing complex will be available for usage on December 31, 2020. Required: Calculate the borrowing cost eligible for capitalization as per IAS 23. Also show the cost of the housing complex as at December 31, 2020. Babel Limited is researching and developing refined processes for manufacturing. During 2020, expenditure incurred was $100,000. $90,000 of this expense was incurred before 1st December 2020 and $10,000 between 1" December 2020 and 31 December 2020. Babel can demonstrate that, at 1 December 2020, the production process met the criteria for recognition as an intangible asset. The recoverable amount of the expertise of the process estimated to be $50,000. Required: How should the expense be treated in the financial statements of Babel as at December 31, 2020 as per the provision of IAS 38 Answers must clearly demonstrate the understanding of the said LAS
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Borrowing Cost Eligible for Capitalization IAS 23 According to IAS 23 borrowing costs that are directly attributable to the acquisition construction o... View the full answer
Related Book For
Income Tax Fundamentals 2013
ISBN: 9781285586618
31st Edition
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
Posted Date:
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