Vijay Ltd. borrowed ₹ 30 lakh at interest rate of 5% per annum and purchased plant and machinery for 60 lakh (using borrowed funds) and started…
CA Intermediate · Advanced Accounting · MTP · September 2026
Vijay Ltd. borrowed ₹ 30 lakh at interest rate of 5% per annum and purchased plant and machinery for 60 lakh (using borrowed funds) and started production. It took 1 year time for Vijay Ltd. to create optimum market for the goods manufactured and generate revenue. How much borrowing cost can be capitalised with cost of plant and machinery:
Suggested Answer and Working Notes:
Correct Answer: Option (C)
(iii) Nil
Topics: AS 16
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