Question
NXS Semiconductor prepares its financial statements according to International Financial Reporting Standards. The company incurred the following expenditures during 2021 related to the development of
NXS Semiconductor prepares its financial statements according to International Financial Reporting Standards. The company incurred the following expenditures during 2021 related to the development of a chip to be used in mobile devices:
| Salaries and wages for basic research | $ | 3,580,000 | |
| Materials used in basic research | 460,000 | ||
| Other costs incurred for basic research | 1,350,000 | ||
| Development costs | 1,930,000 | ||
| Legal and filing fees for a patent for the new technology | 63,000 | ||
The development costs were incurred after NXS established technological and commercial feasibility and after NXS deemed the future economic benefits to be probable. The project was successfully completed, and the new chip was patented near the end of the 2021 fiscal year. Required: Which of the expenditures should NXS expense in its 2021 income statement?
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Public Sector Accounting
Authors: Budding, Tjerk, Grossi, Giuseppe, Tagesson, Torbj
1st Edition
0415683149, 9780415683142
