[This is a continuation of Exercise 1031 in Chapter 10 and includes amortization.] Early in 2021, the

Question:

[This is a continuation of Exercise 10–31 in Chapter 10 and includes amortization.]
Early in 2021, the Excalibur Company began developing a new software package to be marketed. The project was completed in December 2021 at a cost of $6 million. Of this amount, $4 million was spent before technological feasibility was established. Excalibur expects a useful life of five years for the new product with total revenues of $10 million. During 2022, revenue of $3 million was recognized.


Required:
(1) Prepare a journal entry to record the 2021 development costs. 

(2) Calculate the required amortization for 2022,

(3) determine the amount to report for the computer software costs in the December 31, 2022, balance sheet.

Fantastic news! We've Found the answer you've been seeking!

Step by Step Answer:

Related Book For  book-img-for-question

Intermediate Accounting

ISBN: 978-1260481952

10th edition

Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas

Question Posted: