Acca financial Accounting (FA) Study Text ac ca (FA)

Intangible assets 

168

 

KAPLAN PUBLISHING

 

 

4 

Braynee Co has incurred a further $450,000 using flubber in 

creating prototypes of a new heat-resistant suit for stuntmen. 

A 

All of them 

B 

1 and 3 

C 

2 and 4 

D 2 

only 

 

 

Test your understanding 3 

 

During the current year, Deep Blue Sea developed a new material from 

which the next generation of wetsuits will be made. This special material 

will ensure that swimmers are kept warmer than ever. The costs incurred 

meet the capitalisation criteria and by the 31 December 20X5 year-end 

$250,000 have been capitalised. 

The wetsuits are expected to generate revenue for five years from the 

date that commercial production commences on 1 January 20X6.