Accounting · Borrowing Costs (IAS 23)
Silverleaf Co. had the following general loans outstanding throughout the year ended 31 December 20X5: - $40 million 11% loan, repayable 20X8 - $20 million 8% loan, repayable 20X9 On 1 Feb 20X5, Silverleaf Co. began construction on a new retail store. It immediately withdrew $12m of the general loan money to fund this. On 1 March 20X5, it withdrew a further $8m. The retail store was complete and ready for use on 30 November 20X5, but was not opened for trading until 31 December 20X5. What amount of borrowing costs should be capitalised during the year ended 31 December 20X5 in accordance with IAS 23?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1$1,520,000
- 2$1,600,000✓
- 3$1,767,000
- 4$2,000,000
Correct answer
$1,600,000
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