Question 3 Fei Long Company (FLC) is a car manufacturer based in China. In 2017 the company's research department began investigating the prospect of developing a new device for car engines which, if successful, could cut petrol engine carbon emissions by 50%. Events in subsequent years were as follows (all figures in million yuan, m): 2017-2018 During this period, FLC spent 15m on this research. 2019 FLC's technical director was able to convince the company's board that the previous two years of research had paid off, and that he had come up with a technically feasible design (codenamed "Earth's Friend One", EF1). The technical director believed that EF1 could be sold for large sums to car manufacturers for at least the next five years. He also produced details of a prototype which showed that EF1 worked. The board promised to make adequate resources available to the technical director to complete the project. The total sum spent during 2019 was made up of the following: m Services and sundry materials for testing 20 Staff costs associated with the project 15 Expenses associated with the project Proportion of general overheads Training potential "EF1" technical staff 4 10 6 55 2020 The company incurred completion costs of 45m made up entirely of staff costs associated with the project. The technical director produced very convincing details showing strong cash flow projections over the next five years. In September, at a launch party costing 1m, the EF1 was finally marketed. The company's financial year ends on 31 December. Required: State, with full explanations, how costs associated with the above events should be accounted for in the financial statements of Fei Long Company in year 2017 to 2020 and beyond. Note that you are not required to show the journal entries