The following information is extracted from the data record of research and development projects undertaken by JKL
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Question:
The following information is extracted from the data record of research and development projects undertaken by JKL Skin Rejuvenation Ltd for the financial year ended 30 September 2023. Expenditures on research and development were incurred on the following projects.
- Project J is about the development of a natural herb cream. Commercial production and sales of this product commenced in May 2023. The market response was overwhelmingly favourable. It is expected that this product will bring in good profits for the company.
- Project K is about the development of skin enhancement product. Market potential was forecasted to be good for this type of product. Due to an expected budget overrun after a review carried out in September 2023, the product is now on hold and the company is looking for a strategic partner to raise further finance for the project.
- Project L which, commenced during 2023, is about the research of a patented herbal base chemical agent for skin rejuvenation, further research study and data analysis were just carried out to confirm the result.
REQUIRED
In accordance with HKAS 38, explain the accounting treatment for the research and development expenditures for each of project.
Related Book For
International Financial Reporting and Analysis
ISBN: 978-1408075012
5th edition
Authors: David Alexander, Anne Britton, Ann Jorissen
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