Westgold Resources Limited Annual Report 2020

75 Westgold Resources Limited Annual Report 2020 6. OTHER INCOME 2020 2019 Interest income calculated using the effective interest rate method 286,620 308,101 Net gain on sale of assets 3,031,573 139,435 Other income 2,603,081 5,072,351 Total other income 5,921,274 5,519,887 7. EXPENSES 2020 2019 (a) Cost of sales Gold production Salaries, wages expense and other employee benefits 133,259,379 118,157,970 Operating lease rentals – 5,065,998 Other production costs 167,889,923 148,191,774 Write down in value of inventories to estimated net realisable value 1,005,487 – Royalty expense 20,901,094 14,982,184 Contract mining services Salaries, wages expense and other employee benefits 632,015 7,787,879 Superannuation expense – 739,849 Mining and contracting service costs 308,958 13,754,669 Depreciation and amortisation expense Depreciation of non-current assets: Property, plant and equipment 43,275,574 38,488,019 Buildings 1,827,771 1,351,598 Right-of-use assets 7,531,333 – Amortisation of non-current assets: Mine properties and development costs 86,121,198 59,558,183 Total cost of sales 462,752,732 408,078,123 (b) Finance costs Interest expense 2,694,183 4,579,327 Capitalised borrowing costs to qualifying asset (2,694,183) (4,579,327) Unwinding of rehabilitation provision discount 918,881 1,325,025 Total finance costs 918,881 1,325,025 The development of the Big Bell Underground Mine is deemed to be a qualifying asset and interest expenses of $2,694,183(2019: $4,579,327) have therefore been capitalised to the underlying qualifying asset. The rate used to determine the amount of borrowing costs eligible for capitalisation was 4.60% (2019: 6.22%).