Project C costs to 30th June $19,800
Project C was completed on 30th June 2005.
related costs in the SOFP at the start of the year were $290,000.
Production and sales of the new product commenced on the 1st September and are expected to last 36months.
what amount is expensed to the statement of profit or loss and other comprehensive income for year ended 31 December 2005 in respect for this project?
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Answer is (19800+290000)*(4/36)
Am i correct in assuming it met development criteria on 30th June? I do not understand why they have capitalised costs before 30th June?
thanks in advance