Flappy Software began a new development project in 2019. The project reached technological feasibility on Sept 30, 2020 and was available for release to customers at the beginning of 2021. Development costs incurred prior to Sept 30, 2020 were $3,000,000 and costs incurred from Sept 30 to the product release date were $700,00O. 2021 revenues from the sale of the new software were $8,000,000 and the company anticipates additional revenues of $16,000,000. How much will be capitalized as software development costs?

Flappy Software began a new development project in 2019. The project reached technological feasibility on Sept 30, 2020 and was available for release to customers at the beginning of 2021. Development costs incurred prior to Sept 30, 2020 were $3,000,000 and costs incurred from Sept 30 to the product release date were $700,00O. 2021 revenues from the sale of the new software were $8,000,000 and the company anticipates additional revenues of $16,000,000. How much will be capitalized as software development costs?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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