This question is under treatment of MFRS 138

QUESTION 3 On 1 January 2017, Pharmabeauty Bhd invest RM300,000 in research and development to invent new cream product for skin. The cost is to search for the new product alternative product available in the market. The company invest more from July 2017 to December 2017 by RM100,000 but only in January 2018, the new product was success to be developed. The further cost incurred for the development was RM500,000 for the pilot sample which received good feedback. The company registering the patent by March 2018 at the cost of RM120,000 The company financial year ends on 31 March every year. Required: i. Compute the amount of intangible asset to be recognised as of 31 March 2018. ii. Prepare the extract of statement of profit or loss and statement of financial position as at 31 March 2017 and 2018. Show all workings