Reference no: EM132591633
Question a) What are the recognition criteria for internally generated intangible assets according to IAS 38 'Intangible Assets'? Briefly explain each criterion using your own words.
Question b) AMN Ltd incurred costs of £800,000 regarding research and development activities in fiscal year 2018. Based on IAS 38, AMN Ltd decided to write off as an expense £300,000 for activities conducted during the research phase, and to recognize as an intangible asset £500,000 for activities conducted during the development phase.
For the subsequent measurement of the intangible asset, AMN Ltd chose the cost model. For the amortization of the intangible asset, AMN Ltd chose the straight-line method and assumed a useful life of 10 years and a residual value of zero. In fiscal year 2019, expectations about future economic benefits generated by the intangible asset suddenly worsened. A competitor of AMN Ltd appears to have developed a similar asset with higher-quality features. At the end of fiscal year 2019, AMN Ltd estimated the recoverable amount of the intangible asset to be £200,000.
Required:
i) Provide examples of activities for the research and development phases that AMN Ltd could have conducted in fiscal year 2018. Be specific and explain each example. There is no need to repeat the recognition criteria [from a)] or to define the research and development phase.
ii) Prepare the journal entries relating to the research and development activities in fiscal year 2018.
iii) Describe the required accounting treatment for fiscal year 2019. Explain each step and prepare journal entries for each step.
Question c) Considering the decisions AMN Ltd had to make in b), where do you see opportunities for earnings management? Briefly explain what earnings management is and describe at least two different examples applicable to this situation.
|
What are the systemic problems
: What are the systemic problems Mr. Clark has uncovered? What are some strategies that can be put in place to prevent such spending in the future?
|
|
Calculate total sales amount and total sales
: Food Cost is $33,000 and your Food Sales is $80,000 and Beverages Sales is $ 100,000. Please calculate your Total Sales amount and Total Sales
|
|
What is the general purpose of filing the form
: What are the benefits of completing and providing Form W-8BEN? What is the general purpose of filing the Form 1042-S
|
|
Discuss the differences in competencies
: Discuss the differences in competencies between nurses prepared at the associate-degree level versus the baccalaureate-degree level.
|
|
What earnings management is
: Briefly explain what earnings management is?What are the recognition criteria for internally generated intangible assets according to IAS 38 'Intangible Assets
|
|
Prepare the journal entry to record payne income taxes
: Prepare the journal entry(s) to record Payne's income taxes for 2018, assuming it is more likely than not that the deferred tax asset will be realized
|
|
Find magnitude and the direction of force per unit
: Find the magnitude and the direction of the force per unit length between them if the distance between the wires is 0.2 m.
|
|
Discuss what is the yield to maturity
: The bonds issued,The bonds mature in 11 years and have a $1,000 face value. Currently, the bonds sell for $989. What is the yield to maturity?
|
|
What nursing actions need to be included in the plan of care
: You are asked to see Mr. Basset, who is 80 years old, currently living alone, and has recently lost his wife. His children do not live nearby.
|