The Requirement of AASB 138 in Relation to the Amortisation

question 76

Multiple Choice

The requirement of AASB 138 in relation to the amortisation of development cost is that:

• A) It is to be amortised straight-line over a period not greater than 20 years.
• B) It is to be amortised from the time of deferral so as to match the cost to the related benefits.
• C) It is to be amortised using an accelerated depreciation rate over a period not exceeding 10 years.
• D) It is to be amortised from the time the asset is available for use and shall reflect the consumption of the economic benefits by the entity.

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Definitions:

Industry-Average Learning Curve

A benchmark learning curve that represents the average rate at which companies within a specific industry improve their efficiency or productivity over time as they gain experience.

Competitor

An entity or individual that is in the same industry or market and vies for the same customers or resources.

Learning Curves

Graphs that demonstrate the rate at which people learn a new skill or the performance improvement of an algorithm over time.

Budgets

Financial plans that estimate revenue and expenses over a specified period.