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Dear Sir,
In Borrowing cost, capitalisation of borrowing cost for construction.
If the loan withdrawal is from a general loan pool (with weighted average capitalisation rate), the borrowing costs will be capitalised according to the amount of fund used in the period.
But if the entity specifically borrowed the total amount for construction, the borrowing cost will be capitalised as a whole, only deducted for the interest payments receipt for the free fund.
Do I understand this correctly sir?
Many thanks,
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