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Development expenditure

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA FR Exams › Development expenditure

  • This topic has 1 reply, 2 voices, and was last updated 11 years ago by MikeLittle.
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  • June 12, 2014 at 6:28 pm #176300
    gyanmichael
    Participant
    • Topics: 27
    • Replies: 16
    • ☆

    Hi mike, i understand the standard on research and development. About development expenditure, is it the money spent on making a single prototype and then amortising on completion or it is about manufacturing say 1000 new model of BMW. Thanks for your help.

    June 13, 2014 at 6:05 am #176333
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23360
    • ☆☆☆☆☆

    Making, developing, refining, adapting, prototyping, testing, amending, …………..ing

    You’d probably make more than one in this stage so you could experiment and discard if the experiment failed.

    1,000 BMW? Yes, why not, although the number seems a little excessive. I know very little about the car industry (nor cars generally) so maybe 1,000 would be a normal quantity to manufacture whilst the new model in in development stage

    Does that answer it for you?

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