ACCA Strategic Professional · Strategic Business Reporting (International) · Non-current assets
Karel Co incurred the following costs in the year: $120,000 on research into a new process, $90,000 on staff training for the new process, and $60,000 on a customer list generated internally. Separately, it bought a licence for $200,000. Which total is recognised as intangible assets under IAS 38?
The total is $200,000. Only the purchased licence is recognised. Research expenditure, staff training costs and internally generated customer lists cannot be capitalised under IAS 38 and are expensed as incurred.
- A$260,000
- B$200,000Correct
- C$380,000
- D$470,000
Explanation
Research costs, training costs and internally generated customer lists are all expensed under IAS 38. Only the purchased licence of $200,000 meets recognition criteria.
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