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October 2, 2019 at 11:53 am
Hello, Please I was hoping to understand why the development cost of $1,200,000 was expensed and not capitalised . Thank you
December 8, 2019 at 7:49 pm
I learnt from the video that we should capitalize development cost, so even though it’s a prototype we can capitalize as PPE, but it was expensed above sir In question One.
Please can you explain further.
December 16, 2019 at 9:59 pm
We have several Criteria to capitalize Development Exp, one of the criteria is Commercial Viability, On Feb 1 the feasibility to generate revenue from the project was clear, till then directors were not sure whether it will generate the future economic benefits in terms of revenue or cost reduction.
whenever it is given that directors confirmed that project will benefit them, that is the time for capitalizing the development exp in SFP.
August 10, 2019 at 2:21 pm
hello sir, why is $800,000 (Feb-Mar 2013) not amortized?
December 16, 2019 at 9:51 pm
Because the product has not been launched and commercial production not started yet
May 28, 2019 at 11:05 am
Hi sir. For question 1, why only amortise 8 million balance brought forward, but doesn’t amortise the 800,000 capitalised development expenditure incurred between Feb to March? Thank you
December 8, 2019 at 7:47 pm
Hello sir, Please sir I also have the same issue with this question.
I will appreciate if you can explain further.
Thanks for your time.
December 16, 2019 at 9:53 pm
Because the product has not been launched and commercial production not started yet, for $80M there was written that product launched and for the current development expenditure product will be going to launch next year.
May 12, 2019 at 4:47 pm
Hello, I’ve a question regarding question 1 in this practice test (intangible assets ch.6). Why development expenditure of $400 per month incurred between 1.11 – 31.1 to build a prototype are being expensed instead of capitalised? Shouldn’t the design, construction and testing of prototypes and models be capitalised? Thank you.
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