Question: PINAUTANG started constructing a building for its own use in March 1, 2020 . PINAUTANG provided the following information related to the construction: Outstanding loans

PINAUTANG started constructing a building for its own use in March 1, 2020. PINAUTANG provided the following information related to the construction:

Outstanding loans of the Company at January 1, 2020:

Interest Rate	Amount of loan	Interest Cost
5%	P10,000,000	P 500,000
10%	20,000,000	2,000,000
Total	P30,000,000	P2,500,000

On January 1, 2020, PINAUTANG also borrowed P3,000,000 at 15% per annum, to specifically fund its expected construction on March 1, 2020.

March 1, 2020	P1,000,000	February 1, 2021	P3,000,000
May 31, 2020	8,000,000	March 31, 2021	2,000,000
July 1, 2020	7,000,000
November 31,2020	4,000,000
December 31, 2020	1,000,000

How much is the total cost of the constructed asset as of December 31, 2020?

Group of answer choices

23,950,000

22,133,060

21,944,217

22,152,467

Step by Step Solution

★★★★★

3.41 Rating (160 Votes )

There are 3 Steps involved in it

1 Expert Approved Answer

Step: 1 Unlock

Amounts are in P Part 1 Aggregate Interest on general loans ... View full answer

Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock

Step: 3 Unlock

Students Have Also Explored These Related Accounting Questions!

On July 1, 2024, Waubonsee Ltd. issued $3.2 million of 10-year, 6% bonds at $3,449,427. This price resulted in a market interest rate of 5%. The bonds pay semi-annual interest on July 1 and January...

The following questions are adapted from a variety of sources including questions developed by the AICPA Board of Examiners and those used in the Kaplan CPA Review Course to study property, plant,...

The following questions are used in the Kaplan CPA Review Course to study property, plant, and equipment and intangible assets while preparing for the CPA examination. Determine the response that...

1. Cole Co. began constructing a building for its own use in January 2011. During 2011, Cole incurred interest of $50,000 on specific construction debt and $20,000 on other borrowings. The amount of...

Capitalization of Interest McPherson Furniture Company started construction of a combination office and warehouse building for its own use at an estimated cost of $5,000,000 on January 1, 2010....

Capitalization of Interest Vania Magazine Company started construction of a warehouse building for its own use at an estimated cost of $5,000,000 on January 1, 2009, and completed the building on...

You are the accountant for a division of a company that is constructing a building for its own use. It is January 2008, and you are working on closing the books for 2007. The CEO of the division...

Alpha and Beta are divisions within the same company. The managers of both divisions are evaluated based on their own divisions return on investment (ROI). Assume the following information relative...

The rubber worn from tires mostly enters the atmosphere as particulate pollution. Estimate how much rubber (in kg) is put into the air in the United States every year. To get started a good estimate...

(Multi-step Income, Retained Earnings) Presented below is information related to American Horse Company for 2004. Prepare a multi-step income statement and a retained earnings statement. American...

Lebo Company and Ritter Corporation, two corporations of roughly the same size, are both involved in the manufacture of in-line skates. Each company depreciates its plant assets using the...

Write structural formulas and give acceptable names for all the isomeric (a) Nitrotoluenes (b) Dichlorobenzoic acids (c) Tribromophenols (d) Tetrafluorobenzenes (e) Naphthalenecarboxylic acids (f)...

Find the set of values of k for which the line y = 3x + 1 cuts the curve y = x ^ 2 + kx + 2 in two distinct points.

Explain in your own words what it means when one alternative stochastically dominates another.

Consider the prices for the DJ Industrials in the Excel file Closing Stock Prices. The data appear to have a linear trend over the time period provided. a. Use simple linear regression to forecast...

In the context of renting an apartment (Exercise 3.2), some of the objectives may have natural attribute scales. Examples are minimizing rent ($) or minimizing the distance to campus (kilometers or...

The fraction of fourth-generation offspring with genotype AA. Compute the above probability for a selfing plant using Figure 6.2.9.

Is it possible to solve a decision-tree version of a problem and an equivalent influence-diagram version and come up with different answers? If so, explain. If not, why not?

Solve show answer only 33 i! rh f i | i e standards, a supervisor ensure primarily communicated through the grapevine. immeasurable and nonspecific. reflective of what is important to himself or...

NEED ASAP Problem 2 PINAUTANG started constructing a building for its own use in January 1, 2020 . PINAUTANG provided the following information related to the construction: Outstanding loans of the...

PLEASE HELP US ANSWER THANK YOU! PINAUTANG started constructing a building for its own use in January 1, 2020. PINAUTANG provided the following information related to the construction: Outstanding...

1. ABC Company purchased a piece of land with a fair value of $120,000 for $100,000 cash. What is the journal entry to record the land purchase? a.Debit Land for $100,000, debit Gain for $20,000, and...

On July 30, 202X, Company Z started constructing a building in the United States for its own use. To finance the construction, Company Z obtained a loan from Foreign Bank on July 15, 202X. Foreign...

TOPIC: Foreign Currency Transaction Gains/Losses On July 30, 202X, Company Z started constructing a building in the United States for its own use. To finance the construction, Company Z obtained a...

Sammy\'s Motor Repair Shop: In the Beginning At age 26, Samuel Bugarin established his motor repair shop along the highway, one kilometer away from the commercial district of his town. He holds a...