Tesla Ltd spent $900,000 on new electric battery development and recorded the cost as an asset on its statement of financial position as at 30 June 2022. As at this date, it is uncertain whether this cost will result in future economic benefits.

a) Refer to conceptual framework to discuss whether the cost of new electricity battery development should be reported in the statement of financial position as at 30 June 2022.

b) Briefly explain two advantages/benefits of the conceptual framework for financial reporting.

c) There are two methods of accounting for uncollectable bad debts. What are the key differences between the direct write-off method and the allowance method?