[emmajb]

I think this is why:

Expenses 1 January to 1 March (40,000 x 2) $80,000
4 months capitalised and amortised
((40,000 x 4) / 5 years x 3/12) $8,000

1 March to 30th June
40000 x 4 = 160000 is capitalised

Can only amortise when production begins = 30 Jun 20X4 – 30 Sept 20X4 = 3 months amortisation.
160000/5 years x 3/12 months = £8000

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