Neopost SA is a French company operating mainly in Europe and the United States that sells and
Question:
The following note related to intangible assets was extracted from the company's annual report (in millions of euros).
Changes in intangible assets are mainly due to the capitalization of R&D costs and IT implementation projects (reported in column "Other").
Required:
a. Estimate the average expected useful life for development costs for the years ended January 31, 2009, and January 31, 2010.
b. Calculate income before tax and net income for the years ended January 31, 2009 and 2010, assuming that Neopost was not able to recognize development costs as an intangible asset.
c. Determine the net profit margin (Net income/Sales) for the years ended January 31, 2009 and 2010, using (1) actual reported amounts and (2) the amount calculated in part (b).
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