Solution-How much of the costs over the life of the project

How much of the costs over the life of the project

Reference no: EM132060043

Question - TuneIn Pty Ltd produces headphones using cutting edge technology. In 2010, the company started a new research and development program that finished at the end of 2011. Employees have a duty to maintain confidentiality. The following costs had been incurred

Costs	2010	2011
Obtaining knowledge	$90,000
Finding suitable material	$140,000
Building pre-production prototype		$56,000
Testing the prototype		$30,000
Project Related Wages	$46,000	$59,000
Advertising costs		$5,000

At the very beginning of 2011, the project had a significant breakthrough that finally caused the management to believe that all the costs of the project could be recouped in the future. TuneIn Pty Ltd's financial year end is 31 December.

a) How much of the costs over the life of the project can be capitalised and recognised as assets?

b) How much of the costs over the life of the project must be expensed?

Reference no: EM132060043

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How much of the costs over the life of the project

Reference no: EM132060043

Reference no: EM132060043

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