Problem 25-4 (IAA) Molave Company had the following outstanding loans during 2021 and 2022. Specific construction loan 3,000,000 10% General loan 25,000,000 12% The entity began the self-construction of a new building on January 1, 2021 and the building was completed on June 30, 2022. The following expenditures were made: January 1, 2021 4,000,000 April 1, 2021 5,000,000 December 1, 2021 3,000,000 March 1, 2022 6,000,000 Required: 1. Compute the cost of the new building on December 31, 2021 and June 30, 2022. 2. Compute the interest expense for 2021 and 2022. Scanned with CamScannerproblem 25-22 (IAA) 1, 2021, Circus © on June I, ran S Company began . new manwfacr sane plant, The plant eter n October 31, - Expenditures on the priced ets on jy 1, 2021 5,000,000 tober 1, , ae i 4,000,000 ebruary 1, 2 3,000,000 ; 000, April ’ 2 September 1 Aes October 1, 2022 "500,000 On July 1, 2021, the enti construction loan with a 6% in, on December 31, 2022. ty obtained a P7,000,000 terest rate. The loan was paid The only other interest-bearing debt was a long-term note for P15,000,000 with an interest rate of 9%. This note was outstanding during 2021 and 2022. The fiscal year-end is December 31. 1. What amount of interest should be capitalized in 2021? a. 270,000 b. 210,000 c. 540,000 d. 420,000 2. What amount of interest should be capitalized in 2022? a. 1,000,000 b. 1,350,000 c. 250,000 4. 857,000 3. What amount should be reported as interest expense for 2022? a. 1,350,000 b. 1,770,000 c. 913,000 a. 420,000 : Scanned with CamScanner