As 16

Expenses incurred in 3 phases of construction of project of power plant are given below

 

Phase A

Phase B

Phase C

Total

Cash payment

50,00,000

70,00,000

85,00,000

 

Transfer of assets

45,00,000

12,00,000

10,00,000

 

 

 

 

 

 

Total

95,00,000

82,00,000

95,00,000

2,72,00,000

 

 

Money borrowed @ 14%    2, 50,00,000

 

The phase A is complete. How the borrowing   cost should be capitalized?

Answer given in rawat

Phase B     10,55,148

Phase C     12,22,426

MY ANSWER

Phase B     11,48,000

Phase C     13,30,000

 

Where is my mistake ?    

If possible give me detailed answer

thanx

 

 

 

Replies (2)

2,50,00,000 x 14% = 35,00,000

82/272 x 35,00,000 = 10,55,147

95/272 x 35,00,000 = 12,22,426

How did you arrive at that answer?

this answer as per my account proffesor

i have capitalized only 24,78,000. 70.80% of 35,00,000

1,77,00,000/2,50,00,000*100=70.80%

now

B 24,78,000*82/177

C 24,78,000*95/177

phase A is compelete so capitalisation is ceased

 

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