Jackson Ltd Is Developing Computer Software for Use in Its

question 34

Multiple Choice

Jackson Ltd is developing computer software for use in its courier delivery service business.So far the company had spent $50,000 but the software is still unfinished and not expected to be finished in time for the preparation of the reports.As a result,the company had to purchase a computer package amounting to $100 000 to finalise its accounts.There is no further use for the unfinished software as it is expected that the package could be used by the entity for another ten years.Which accounting treatment would be consistent with the Framework?

• A)Recognise an asset of $150,000.
• B)Recognise an expense of $150,000.
• C)Recognise an asset of $100,000 and expense of $50,000.
• D)Recognise an asset of $50,000 and expense of $100,000.
• E)None of the given answers.

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Definitions:

Free Association

A psychoanalytic therapy technique where patients vocalize their stream of consciousness without censorship as a way to uncover unconscious thoughts or feelings.

Psychotherapist

A professional who treats mental health issues by psychological rather than medical means, often through talk therapy.

Trivial

Of little importance or significance.

Sigmund Freud

A pioneering Austrian neurologist who developed psychoanalysis, a treatment for mental health issues that relies on conversational interactions between a psychoanalyst and the patient.