What amount will be charged to profit or loss for the year ended 30 September 20X8 in respect of research and development costs?
A company had Rs.20 million of capitalised development expenditure at cost brought forward at 1 October 20X7 in respect of products currently in production and a new project began on the same date.
The research stage of the new project lasted until 31 December 20X7 and incurred Rs.1.4 million of costs. From that date the project incurred development costs of Rs.800,000 per month. On 1 April 20X8 the directors became confident that the project would be successful and yield a profit well in excess of costs. The project was still in development at 30 September 20X8. Capitalised development expenditure is amortised at 20% per annum using the
What amount will be charged to profit or loss for the year ended 30 September 20X8 in respect of research and development costs?
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