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Question 2: Energy Ltd is involved in the research and development of a new type of three-nned surfboard. For this R 8: D it has

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Question 2: Energy Ltd is involved in the research and development of a new type of three-nned surfboard. For this R 8: D it has incurred the following expenditure: - $50 000 obtaining a general understanding of water-ow dynamics $30 000 on understanding what local surfers expect from a surfboard $90 000 on testing and rening a certain type of n $190 000 on developing and testing a full prototype of the three-finned board, to be called the 'thruster' There is expected to be a very large market for the product, which will generate many millions of dollars in revenue. Determine how the above expenditure would be treated for accounting purposes

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