5. Borrowing costs (continued)
Borrowing costs are recognized as expenses when incurred. Where the borrowing costs directly attributable to the acquisition, construction or production of uncompleted assets should have a sufficiently long time (over 12 months) to get ready for intended use or sales borrowing costs have been capitalized. For private loans serve the construction of fixed assets investment property, interest is capitalized even if the construction period of less than 12 months. The income arising from the temporary investment of loans are deducted from the related asset prices.
For general loans including use for purposes of the construction or production of an asset unfinished, the capitalization of borrowing costs is determined in proportion to the cost capitalization weighted average cumulative incurred for capital construction investment or production assets. The cap rate is the interest rate calculated according to the weighted average of loans outstanding during the year, except for separate loans to serve the purpose of forming a specific property
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