Question ONE On December 31, 2010, Tisco Group borrowed USD56,000,000 at 10% payable annually to finance the construction of a new building. In 2011, the company made the following expenditures related to this building: March 1, USDS720,000: June 1, USD$1,200,000: July 1, USD$3,000,000; and December 1, USDS2,400,000. Additional information is provided as follows. USD$8,000,000 USD$3.200.000 Other debt outstanding 10-year, 11% bond, December 31, 2008, interest payable annually 6-year, 10% note, dated December 31, 2008, interest payable annually March 1, 2011, expenditure included land costs of USD$300,000 Interest revenue earned in 2011 on funds related to specific borrowing USD$ 98,000 Required: a. Determine the amount of interest to be capitalized in 2011 in relation to the construction of the building. (25 marke b. Prepare the journal entry to record the capitalization of interest and the recognition of interest expense, if any, at December 31, 2011.625 marks) Question TWO FLOWER Corp. purchased machinery for $ 500,000 on July 1, 2015. It is estimated that it will have a useful life of 15 years, residual value of $ 25,000, production of 200,000 units, and working hours of 40,000. During 2016, FLOWER Corp. uses the machinery for 6,500 hours and the machinery produces 30,000 units. Instructions: From the information given, compute the depreciation charge for 2016 under each of the following methods. a) Straight-line. (10 marks) b) Units-of-output. (10 marks) c) Working hours. (10 marky d) Sum-of-the years'- digits. (10 marks) e) Double-declining balance. (10 marks)