ere appropnate or marks will be deducted. Case Study Two Rocks Ltd is a highly successful engineering company that manufactures filters for air conditioning systems. Due to its dissatisfaction with the quality of the filters currently available, on 1 January 2017 it commenced a project to design a more efficient filter The following notes record the events relating to that project 2 2017 January Paid $145,000 in salaries of company engineers and consultants who directly and only conducted basic tests on available filters with varying modifications February Spent $165,000 on developing a new filter system, including the production of a basic model. It became obvious that the model in its current form would not be successful because the material in the filter was not as effective as required. Acquired the fibres division of Sand Hill Ltd for $330,000. The fair value of the tangible assets of this division were: property, plant and equipment $180,000; inventories $60,000 This business was acquired because one of the products it produced was a fibrous compound sold under the brand name Foamy that Two Rocks Ltd considered would be excellent for including in the filtration process. By buying the fibres division, Two Rocks Ltd acquired the patent for this fibrous compound. Tow Rocks Ltd valued the patent at $50,000 and the brand name at March Semester 1 2018 ere appropnate or marks will be deducted. Case Study Two Rocks Ltd is a highly successful engineering company that manufactures filters for air conditioning systems. Due to its dissatisfaction with the quality of the filters currently available, on 1 January 2017 it commenced a project to design a more efficient filter The following notes record the events relating to that project 2 2017 January Paid $145,000 in salaries of company engineers and consultants who directly and only conducted basic tests on available filters with varying modifications February Spent $165,000 on developing a new filter system, including the production of a basic model. It became obvious that the model in its current form would not be successful because the material in the filter was not as effective as required. Acquired the fibres division of Sand Hill Ltd for $330,000. The fair value of the tangible assets of this division were: property, plant and equipment $180,000; inventories $60,000 This business was acquired because one of the products it produced was a fibrous compound sold under the brand name Foamy that Two Rocks Ltd considered would be excellent for including in the filtration process. By buying the fibres division, Two Rocks Ltd acquired the patent for this fibrous compound. Tow Rocks Ltd valued the patent at $50,000 and the brand name at March Semester 1 2018